Factors Before Investing in Real Estate

Investment professional Rilk Dacleu-Idrac is the group head of global support at the Qatar Investment Authority in Doha. Since joining the middle east based sovereign wealth fund that has gigantic reserves 2014, Dacleu-Idrac has covered investment planning and execution in a various sectors including real estate and Qatar's chase of trophy assets.

Before investing in real estate, there are several factors to consider. While location is always the first thing people think of, it would be best if an investor checks the following factors discussed here before making a final decision:

1. Property valuation

Investors will need to consider the importance of property valuation for financing. Investment analysis, taxation, insurance, and listing price all depend on property valuation.

2. Budget consideration

Any investor looking to invest in real estate or any other investment kind will need to have a budget. Having a budget will help determine the property type they can afford and help them narrow down their choices. Remember to include money for hidden expenses that may occur along the way, such as furnishing, renovation costs, or even cash for agencies or banks.

3. Payment plans

Investors must determine if they want to finance it through a bank loan, how long the repayment may last if they take it, and other crucial questions to ask themselves. In some cases, installment payment is accepted more than a one-time fee. This payment type is advantageous as it gives the investor time to pay for the property without paying high interest to banks.

4. Investment purpose

Deciding on a property's use will help the investor determine which real estate type to buy and its location. For instance, investors desiring to get a commercial property will need a bigger space. Similarly, people looking to invest in an office space will have to invest in areas where there are many businesses.

Another typical point to consider is how long you would like to "stay in" before thinking exit, and what level of return on investment you would like to achieve.

All these factors help when it comes to find the suitable investment choice when one targets real estate investing. Whether an amateur investor with good capital in savings or an institutional investor aiming to build up an extensive real estate portfolio.