After you have start earning your own income, there will be various options in investment that you would come across where many would tell you that property is perhaps the most stable. The truth is, investing in property is somewhat similar like investing in anything else (forex, mutual funds or shares) where there are risks involved. But the price of property can be less volatile making it more stable.
So when is the best time to get into property investment? There would be several questions you need to ask.
Firstly, you need to calculate your return target and how much downpayment you can afford. After that, you need to calculate how much you can give as monthly installment from your available income. This should not be more than one-third of your bring home pay.
Then you need to determine what is your target before stopping and any risk management.
Basically, it is like buying a property for yourself but you need to be more calculated in every way.
Going into property investment is a viable option mainly because it is more predictable than any other investment methods.
It has an inflation hedge because as the price could increase, rental rates would follow suit.
This means that if you have a property which is rented out for a certain period of time, chances are you will not have to worry about installments as long as there is a tenant. That way, you need not have to worry about money for a while. Once the loan is paid off, you will then be able to enjoy the rental as income.
But the trick is to be select carefully and not invest in any property that you might not be able to afford. You need to be ready for the worst-case scenario and if no one is renting, you need to service the loan accordingly. If you can answer these questions, then you might just be ready to invest in properties. At the end of the day, always remember to keep some funds for rainy days and learn about the tips, particularly if you are a new graduate.
