Location, and research
We obviously spend a lot of time researching properties, locations and investment strategies – it’s a passion! This week I discovered this interesting article on Forbes and it made me think about our investors. Briefly, the article talks about three factors that you, the investor, should keep in mind when choosing an investment location. Let’s look at how these factors compare to the JPI investment model.
Strong rental market?
I like this article because it gets straight to the point. Why would you buy a rental property in a depressed area? You might be hoping for a bump in rent or an increase in property prices but smart investors don’t hope. Smart investors seek out strong markets to benefit from. The Japanese rental market is strong and stable with good tenants. It is an established market that continues to do well on monthly returns and steady property prices.
Another good point form the author. I speak with many who believe real estate doesn’t offer the same diversification as other investment vehicles, which I believe is not true. You can own commercial or residential real estate. Or own rural, semi-urban or urban real estate. Perhaps even own a $10 million mansion or a $20,000 parking lot. Or you can choose to diversify the country you invest in and that is where JPI can help you. Perhaps the rental yields in your home country are slipping, less demand or an excess of supply may be reducing the amount you can charge in rent? Or property prices are so high you will have to subsidize the mortgage payments to cover your payments. Japanese property offers investors from around the World the opportunity to access diversity with excellent returns from a stable tenant base.
Okay, this is where the author’s strategy and our investors differ. The author has a very sensible strategy towards retirement here. If you want to retire in an area that you are not currently working in, buy a rental property there, have tenants build equity, ideally pay off the whole mortgage. Then you will be all set to enjoy a mortgage-free retirement in your dream location. This is a very smart strategy. However, it is unlikely that JPI investors will want to retire to Japan, although we do have one or two investors considering this option. Personally, I wouldn’t retire anywhere else!
So there you have it an interesting article that made me think this week. If you are looking to reap the rewards of a strong and stable rental market whilst diversifying your investment portfolio, call or email us today to “invest together, grow together” www.japanpropertyinvestments.com