An understanding of the real estate markets has to be rooted in an understanding of the underlying participants as well as their motives
The people of Kashmir have always expressed their interest in the property market, as we all are aware of the fact that real estate investments are the safest and the most profitable ones. Kashmir has a huge potentialto make a significant mark in the real estate industry and the people of Kashmir have always been positive about the real estate investments and have not hesitated to make an investment in the property market all across the globe.Real estate is a property made up of land and the buildings on it, flora and fauna, livestock, water and any additional mineral deposits. Real estate is a tangible asset and a type of real property. Real property examples include land, buildings, plus the rights of use and enjoyment of that land and all its improvements. Real estate has three basic categories; residential, commercial and industrial. When it comes to investing, residential real estate is less expensive and more feasible to individuals. As an investment, real estate offers income and capital appreciation. Real estate markets are complicated. The price movements in this market are usually slow. A major factor behind this is the type of investors who put their money in the real estate markets. Therefore, an understanding of the real estate markets has to be rooted in an understanding of the underlying participants as well as their motives. The most important feature based on which we can distinguish real estate investors is their investment motive. All investors buy real estate. However, not all of them do for the same reasons. Let’s have a look at the three major categories of investors in the market.
Speculators
These are the kinds of investors that are not actually “investors” in the first place. They give a bad image to real estate investing. This is because if you listen to them and believe their claims, they will make a sophisticated operation like real estate investing sound like a no brainer. Simply by flipping real estate, they claim to have made million dollars without investing their own money. But if we look at the facts such results are never achieved. Real estate investment is a slow and long process or we can put it this way, real estate is an old school investment game that only pays off in the long run. Most of these speculators are either people trying to make quick money by flipping real estate or people who have fallen prey to these con men and are actually trying the short cut method and short-lived strategy. Such kinds of investors were hard to find just a few years ago. However, now they have become a lot more common.
End users
This is the most common and talked aboutcategory of investors that you will find in the real estate market. Usually these kinds of investors are buying their own homes. They want to buy a house with the intention of staying in the house for decades. This changes their outlook towards the investment. For them real estate is not a financial decision. They look at it as a lifestyle choice and their requirement. Hence, factors such as lifestyle amenities available nearby as well as the distance it takes to commute to work become extremely important. The demand for these kinds of investors can be predicted based on their job locations, family, friends and the most important factor will be the budget set for buying a house.
Long-term investors
Lastly, we have the long-term real estate investors. These are the kinds of investors who actually build a lot of wealth through real estate by being consistent, patient and keeping long-term goals in their mind. Like the flippers, these people too invest in the real estate market to make money. However, their decisions are not short term. They understand and know that real estate is a slow moving, illiquid kind of asset that steadily grows in value over a number of years. Long-term investors are the ones who go the long way and make a fortune for themselves.
Many people would have been keen to invest in the property market but definitely there are questions popping up in their minds, what kind of investments would be beneficial for them? Which real estate market to look for? How to invest there? What are the benefits of making real estate investments? And in what ways real estate investments will turn out to be more profitable for them. But without an appropriate answer no question is born.Stay safe and make safe investments.
(Author is a Certified Real Estate Professional)
harisashah@gmail.com