In buying home units, there are some things which have to be considered and remembered. Home units keep investors restricted. In contrast to houses, home units offer lesser options. Holding onto it and believing that in the long run, the value will increase and money can be made out of it, then an investor's decisions are wrong. The strategy is not at all good, it only causes more problems.
Frankly saying, investors can not do a lot of things with a home unit. They can not significantly boost its value. As a result, investors can only depend on the market and so investors must be careful.
As you buy a home unit, you are also embracing the probability of problems. Units are not just composed of bricks and mortar. Together with these units, come the tenants, a body corporate and lots of other people dwelling in a single building. Mind you, they have a greater impact on your possibilities of making money.
One of the possible problems you may be experiencing with home units are as follows:
Home units are not easy to sell. In fact, they're harder to sell as compared to selling houses.
Mostly, typical home unit lease holders are short-lived. A lot of these holders are single women and single men who are not yet financially responsible as compared to married couples.
Another problem with typical unit lease holders is they may not have a stable income or may not live in the unit long enough to actually have the chance of becoming seller financing clients in the future.
Some painting or changing the kitchen can be done. But renovations with the unit in order to increase its value are not totally possible. In turn, investors have to hold on to the property for 10 years and just wait for the market to go up so they can gain a profit of equity.
Some reasons why home units are so cheap are mainly because there is a very large percentage of property-investor occupancy. Lenders like to give loans on units that are in a block containing a high percentage of home-owners as opposed to high percentage which are investment owned.
It's difficult for lenders to lend money for investors who own buildings with a higher percentage of investment owned units and lesser homeowners. If they do lend the money, it's only of a lower ratio. Lenders know very well that investors might not be able to watch over these properties. But homeowners can. So, it's best to go for buildings with a good number of homeowners and things will be a bit fine.
Bear these things in mind. Be reminded about these whenever you think of buying home units and houses! After all, these can help you in one way or another succeed in businesses like these!
Author Resource:
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