![Why You Should Buy A Rental Property These Ember Months](../wp-content/uploads/2017/10/188-780x405.jpg)
Why You Should Buy A Rental Property These Ember Months
As we are right in the “ember” months it might seem unrealistic to buy a rental property in Nigeria just a couple months before year-end. But as someone once said, “there is no better time to get started in investment property than now”. When I was growing up my grandfather had rental properties in some major cities in Nigeria and this was basically his livelihood. He was constantly receiving income from the properties and he owned all these houses he could sell if he wanted to. Everyone around thought he was made.
Truth is, owning an investment property in Nigeria isn’t all roses and unicorns as it takes time and skills to manage a rental portfolio so this might not be the business venture for everyone. Truth is more entrepreneurs should consider rental real estate as an important part of their portfolio. Why is this so, An income property is a property bought or developed to earn income and it can be a lucrative investment.
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A good rental property strategy will not only to build an incredible long-term plan that will inevitably build wealth for future retirement and should provide current cash flow benefits if you choose wisely. Investing in rental properties for beginners could be pretty tasking yet has long-term benefits if chosen well. Still not convinced? Let me list a few reasons that may change your mind and move you to put your money on investment properties these ember months.
1. The use of leverage
Real estate is one of the investments in Nigeria where you can use the bank’s money on your investment. The ability to leverage on a mortgage can help you invest. The ability to make a down payment, leverage your capital and thus increase your overall return on investment is incredible.
2. Appreciation
Rental properties are investments you are keeping for at least 5-10 years so you will be expecting the property to appreciate in value during the period you’ll own it. Don’t discount appreciation of real estate in the Nigerian market. Not all properties in the market experience this growth at a fast pace, while some actually do even better. The area and types of property play a factor.
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3. Income from renters
The major benefit of owning a rental property is that you’ll be getting a direct income stream from renters. Those monthly rent checks go straight into your business account. For example, if you own 3 flats and you rent each out for 500,000 yearly rent, that totals N1.5 million per year into your account. It’s hard to argue with a direct income stream like that.
4. You are the boss of the income
When you buy an investment property, you become your own boss. You choose what property to invest in, what tenant you will rent to, how much you will charge in rent and how you will manage and maintain the property as a whole. In the average 8 to 5 job, you are subject to the wishes of your boss and the company infrastructure in general, such as adhering to a dress code. As your own boss, you can wake up at 11 a.m. and wear what you want to without anyone telling you what to do.
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5. Investment real estate is a forced retirement plan
A lot of Nigerians lack self-discipline and find it hard to put a monthly deposit into a retirement fund as small-business owners. However, buying a rental property is a significant commitment that you are required to commit to and maintain. You will always be grateful in the long run when you don’t give up on it and build future cash flow and wealth.