Factors to Consider When Selecting A Vancouver Real Estate Investment

By
Real Estate Agent with REMAX CREST REALTY WESTSIDE

A real estate investment can simply be described as putting down something today and expecting to make some return tomorrow. As an investor, you’ll have to identify an investment vehicle where you can invest your resources and make more money in the future and you’ll have to determine the pros and cons of each investment opportunity.

 

There are some key factors that you must take into consideration when looking at a  real estate investment.

 

The Risk Factor

 

Risk or the uncertainly of making the expected return on that investment is a key factor. The best description of risk is simply not understanding what the investment is all about. It goes beyond the common belief that the higher the risk the higher the returns.  If you do not understand the real estate investment you are looking at then you are taking on a big risk.

 

The Liquidity Factor

 

You must consider how liquid the investment is. This refers the ease of converting the investment into cash. Some investments like stock are very easy to dispose of while others take a while to sell off like real estate. You must find a suitable buyer and then sell it off. The selling process can take awhile. The buyer must complete the process of financing, the house must be appraised before the sale is complete, and then there is the process of changing documents.

 

While a real estate investment is not as liquid as other investment opportunities, the potential is there for much higher returns. This must be factored into your decision.

 

The Management Factor

 

Some investments need to have hands-on management while others do not really require a lot. Real estate is one of those investments that require proper management. This includes collecting rent, carrying out repairs, paying taxes and insurance, etc. A good property manager is essential if you are planning on playing a  real estate investment game.

 

Leverage Factor

 

Leverage refers to the use of finances from a financing body for investment. Leverage does not work for all types of investments. A  real estate investment is one of the few investments that allow for leverage in order to increase investment returns.

 

Appreciation Factor

 

This is a measure of the rate at which an investment grows in value. Some investments grow slowly but steadily, others keep fluctuating while others do not change much. Real estate is an investment that generally grows steadily in value, and if it does dip, it will rise again stronger than ever.

 

Taxes Factor

 

The tax implications of any investment are important. Real estate is an investment that has a relatively light tax burden, if done correctly.

 

Make sure that you examine all these factors when choosing to make a Vancuver real estate investment. Select an investment that best suits your goals and budget by taking all of these factors into account.

 

 

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JARK KRYSINSKI, REALTOR
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Rainmaker
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Jon Kolsky
REALTOR® Long Beach, CA
Kolsky Group/Spellens Realty

What a perfect blog, you hit the key to investing. Real Estate investments have proven to provide successful returns! There's nothing like residual income for the rest of your life, while your investment typically grows, never losing it's value! Smart Blog...IMO

Thanks

March 08, 2012 10:46 AM
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Rainer
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Jark Krysinski

TeamYVR Team Leader, BA,ABR,IRES,IMSD,LLB
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Additional Information

Hello, my name is Jark! I have been a real estate investor for the past 15 years, predominately in the Greater Vancouver area but also in the developing real-estate locales of Whistler as well as Revelstoke. I share my research and writing on a daily basis as an added service to my clients. It's important to realize that REALTORS are not only sales people but are also scholars of Real Estate in their own right. The hundreds of articles I've published serve to exemplify this point. In Vancouver specifically, I’ve bought and sold more than four businesses of my own – prior to licensing as a real estate licensee – and have bought three passive real-estate holdings. If you’re looking for an agent who’s not only thought about real estate but has also bought and sold his own properties, and taken his own calculated risks, give me a holler and we’ll discuss the market and your participation therein. For more than theory, speak to someone who’s empirically on the same page as an experienced real estate investor.