leading platforms that offers a substantial return on investment.
It becomes incumbent upon every potential investor to understand the dynamics of picking the right property to invest in that will ensure that profit is made either on resale or through rental income.
One cannot ignore the lure of bargain properties whenever the opportunity presents itself.
These are properties that are on the market for prices that are significantly below market value.
It is imperative that the potential investor meticulously investigates the reasons why the property is on the market at that price.
Some have learnt through painful experience that not everything that is advertised as a bargain is actually one.
In bargain transactions personal discernment or qualified advice is paramount and in most cases time is of the essence.
The need for a quick sale is normally the primary reason for the bargain.
In some cases, the adage which says all that glitters is not gold applies while in others it might be a genuine once in a lifetime opportunity.
However, one has to undertake a general study of the history of particular property including its surrounding properties.
This must be coupled with the knowledge of future projects authorities intend to undertake in the property locality, which should assist one in reaching an informed conclusion.
When identifying the ideal property, information on macro- and micro-economic issues is fundamental.
It allows the potential investor to be aware in advance of developments or projects that are going to be undertaken in certain areas in the short to long term.
This gives the investor a headstart on purchasing cheap property before the multitudes are made aware of the compressed value potential of such properties.
Examples of such projects might be the granting of mining licences to certain companies, industrialisation or major property developments.
This will likely increase the demand of real estate in such areas as more people are drawn by such projects inevitably increasing real estate values.
This method might seem long for the short-term investor.
In such instances the short-term investor must buy in when the development has commenced and in order to minimise risk. They should fully understand the terms and conditions of such development plus the length that the development is going to take complete.
Here the short-term investor is guaranteed of a return on their income although it might not be as substantial as the long-term investor who invests mainly on information of supposed intentions.
Here the old adage which says high risk ensures a high return is applicable.
It is important to understand that the actual value of a property is not just premised on its resale value but also on its rental return and how long it takes before the property pays for itself completely by paying back the investor the initial investment amount through rental returns.
At this point the investor has to target those properties that offer a possibility for high returns.
One may just focus on those properties that are grossly mismanaged that the incumbent owner is self-defrauding of own potential income that he would have benefited from had the property been well managed.
At this point one may persuade the owner to sell property using the mismanaged rental figures to ascertain value.
One may even offer higher than the value reached but lower than the potential value of a well-managed property.
At this point one may purchase, clean up the mess of mismanagement and by so doing increase the rental value which also vicariously determine that resale value.
Whichever method, one intends to use, it is important to understand that no two properties are hundred percent identical.
Properties are individualist in their nature and what occurs in one property transaction is not guaranteed to occur in another.
One has to look for particular features or possibilities on a property that will certainly ensure a return on investment.
l Vengai Madzima is a property investment consultant and analyst with Wisdom Properties. He can be contacted on 0772 468093 email: [email protected]



