HOW TO BUILD YOUR PROPERTY PORTFOLIO IN PAKISTAN
A property portfolio is the collection of real estate property owned by an individual who is an investor or by a group of individuals. It’s beneficial to invest in multiple properties as it can bring you some lucrative cash along with financial stability. In Pakistan, it is really important to have your own property portfolio from different cities. It gives you the freedom of having multiple growth opportunities, as the earning is not just limited to your pension.
Before we dive into how you can build your property portfolio, first you need to know the benefits of having a property portfolio:
One of the best reasons why you should have your own property portfolio is to have access to equity. You will have more access to equity if you own more than one property as the value of your property grows. If you are investing in one property, it’s more likely that the profit will be limited. Invest in other properties, and when the value of your property increases, you can borrow against that increased value. This way your profit will be more and your property portfolio will grow faster as well.
INCREASE IN PROPERTY VALUE OVER TIME:
Every day in Pakistan, the price value of each property fluctuates with time due to the economic cycle. If you have your own property portfolio, it means you have better chances of all your property’s value going up resulting in profit for you. It will increase your profitability if the rent of your property also increases.
MORE SOURCES OF INCOME:
It allows an individual to have more than one source of income. If you have more than 15 properties, and just three of them aren’t rented, it means the rest of them are benefiting you and strengthening your financial growth. The cash flow will be higher because the demand for your property will be high as some areas have popular demands. You can rent out your property to gain more income.
HOW YOU CAN BUILD YOUR PROPERTY PORTFOLIO?
RESEARCH YOUR INVESTMENT PLAN
You need to have a clear plan about your investment plan and what do you want to achieve from these portfolios. Do you want to invest to gain some profit for a short-term period, or do you need a profit for long-term stability?
SEEK ADVICE FROM YOUR BANK
You need to know where you currently stand and how much equity your current property brings if it has more worth. If the demand is very low for your property, then you need to give some time for the equity to grow as the property value changes from time to time. If the equity is enough for you to buy your next property, then go for it.
PURCHASE YOUR FIRST PROPERTY
The first step towards building a property portfolio is to maintain good, solid properties in your portfolio from the start. Research the property that you could purchase. Start looking at the property available on the market that you could buy. You need to be prepared about the additional budget you need to pay for costs that come from owning a new property.
MONITOR THE MARKET
Keep an eye on the profits and on the fluctuation of the property value in the market. Stay ahead of the upcoming trends happening in the market, so you can plan ahead if the prices change. This will let you know how your investment could get affected, and you will change the strategy of your investment.
BUY MORE PROPERTIES
Now that you have purchased your first property and have ample knowledge about the market. It’s time you keep on purchasing the properties that are the best in the market to grow your property portfolio. There are residential properties in Pakistan that you could purchase, commercial properties, industrial properties, agricultural properties, and some vacant plots.
DEVELOP YOUR SOCIAL NETWORK
Anyone who wants to build a property portfolio needs to have a social network in the real estate industry. You need to have professional contacts who guide you and help you whenever you need them. It will help you stay updated about the current trends and new areas that are high in demand.
REFINANCE YOUR PROPERTY
Refinancing your property results in having more properties in your portfolio. It gives you the opportunity to reinvest in more properties. Refinancing means that you trade your existing mortgage for a new one. Investors in Pakistan change the terms of their existing loans so they can refinance at an accurate time.
Real estate investment is a tricky road with a lot of bumps where you may experience some steep and narrow ends. It is a risky yet business where you learn everything step by step on the way. Every day is a new day in the market of real estate. It comes with great challenges, and it will make you more aware of the real estate investment.
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