Considerate and Controlling Property Investment Risks - Escudero and Brown Review

1. Considerate and Controlling Property Investment Risks Escudero and Brown Review

2. Introduction • Although property investment can be comparatively safe, there are certain risks inbuilt in the investment process. To ensure a positive outcome, it is always important to comprehend and deal with these risks. The success will thus always hinge on an efficient risk alleviation strategy that you have to think about before buying your investment property.

3. Economic Stability & the Property Market • Your property investment will really depend on current and future economic surroundings. Property prices and rental yields can be repeated, and thus if you are planning on a long term investment, accomplishing positive cash flow regularly might not be possible. Property prices might decrease, property approval might not be as expected. While you cannot guess the future, you can make sure that you have an understanding of the risks occupied in your investment, by spending due attentiveness, and researching the property market comprehensively. Economic growth, political stability and new investments in your chosen area, for example are always positive signs.

4. Moderate Property Appreciation • While house prices are said to double every decade, this might not be the case in times of economic collapse. You will thus have to have the resources and tolerance if you are planning for a long term investment. You can also achieve higher levels of property approval if you manage to buy an investment property below its market value. A BMV property can thus correspond to a safer long term investment that has improved chances of bringing you high yields.

5. No Tenants • If you are investing in a buy to let property, occupants are the backbone of your investment. It is thus necessary to stay away from long void periods. One way of solving this trouble is if you are prepared to lower rents if needed. By lowering the rent, you could find occupants much more rapidly, and would not potentially lose out on 2 or 3 months of rental yields. By practicing due carefulness and buying your rental property in a high demand area, you can also get the better your chances of getting stable occupants more rapidly.

6. Unanticipated Costs • If you are investing in a buy to let property, you will have to calculate on unexpected repair and other costs. It is hence important not only to take out a renter assurance, in case your tenant doesn't pay, but to get full insurance for the property and to have the economic resources to be able to cover any further costs.

7. Issues with Reselling the Property • Once you want to resell your investment property, finding a buyer has been never a conviction. If you plan your property investment well, and decide with prescience, you should be able to ultimately find an appropriate buyer. Always try to prefer a property in a secure area with high demand.

8. Fundamental Principles of Risk Management • If you keep in mind the fundamental principles of risk management, you will have a much better chances of higher earnings. If you have the financial resources, try to build a different investment portfolio, which will allow you to preserve a positive cash flow, even if one of your investment properties is not performing as estimated. You will also have to make sure to research your alternatives carefully, complete due carefulness, make exact cash flow projections, and try to buy the property under its market value.

9. Contact Us UK Office1st Floor 2 Woodberry GroveFinchley, London N12 ODRT: +44 207 6924053info@escuderobrown.com USA Office3409 North Holland Sylvania,Toledo, Ohio 43615T: +1 567 343 7065ashaki@escuderobrown.com Spain OfficeOffice nº 20, 1Centro Comercial PlazaMarbella, Spain 29660T: +34 677 360 999guillermo@escuderobrown.com http://www.escuderobrown.com https://www.linkedin.com/company/escudero-&-brown