Who is a native investor?
An investor is someone who leverage money in a business/product, so as to generate profit or reward. So traditionally,anybody can be an investor no matter how much you earn.
However, some certain set of people have coinedthemselves to be the modern/real investors; they are theventure capitalist and angel investors.
Angel Investors are individuals who can invest between$10,000 and $1,000,000 in a business.Venture capitalist are the few individuals or firms thatcan invest over $1,000,00 0 in a business.
We intentionally shared the figures above to broaden yourmindset as regards investment.
People invest millions ofdollars in property and products, and We won’t want theaverage Ghanaian to settle for less, judging investment bythe petty deals they see around them.
Roadmap to Becoming a Successful Real EstateInvestor in Ghana
A real estate investor this time around is simply anybodythat invest or put money in real estate’s.
Popular exampleof which are lands, houses and commercial buildings etc.
Real-estate investors are not only limited to buildingproperties from scratch, they can as well buy and sellproperties or buy, renovate and sell properties etc.
Most people will jump into searching for property for sale inGhqna, thinking the money is in the deal, No! Knowing therudiment of real estate investing is very vital, and it beginswith having a clear understanding of the terminologies usedon a day-to-day basis.
Real Estate Terminologies
Listed below is the simplest definitions to some of thecommonly used terminologies when doing real estate inGhana:
1. Real estate Brokers: These are professionals whofacilitate the buying and selling of landed properties.
Mentor “Robert Kiyosaki ” do call this people brokepeople, simply because they can’t take all the dealsthat comes to their table, they’re broker than you’re.
2. Land: This the solid surface of Earth that is notpermanently covered by water.
3. Agent: This are local and unlicensed individuals whoact like real estate brokers.
They are much popular indeveloping countries like Ghana, since they are moreaccessible to investors and home buyers than the real-estate brokers. They help you scale through propertiesfor sale in Ghana.
4. Property: a property is anything you can own and use.Everybody has a right to own properties.
5. Real estate investing: According to Wikipedia “Realestate investing involves the purchase, ownership,management, rental and/or sale of real estate forprofit.”
6. Real estate deals: This a complete real estate purchaseor transaction. Don’t ever over-look the process ofmaking deals, as it is far more than just paying theseller.
7. Real estate options: options in real estate are thevarious ways to make money in real estate. Popularoptions are;
Purchase and sale of land/properties;
Buy and rent of properties;
Buy, renovate or development of properties;
Other less common options are buying units in housingand commercial estate yet to be constructed and sellingafter they are constructed.
Real estate investing just like any other businesses, isdependent on sales and cash flow. You can’t be asuccessful real-estate investor if you constantly run out ofmoney and you don’t know how to raise money.
Though it’s very obvious you can’t buy every property thatcomes your way, knowing how to secure funds forpurchasing the property will help ensure you get your handson the right deals.
Based on a research We did recently, I confirmed the onlyaccessible source of loan for real estate in Ghana, to bethe commercial banks.
Other sources are not reliablebecause they are not always accessible when needed andthe requirements are quite bulky.
Even LAPO and other common micro-finance bank won’tborrow you money to do real estate in Ghana.
So how do you start or fund your real estatedeals?
The easiest way to start your real estate deals and fundthem successfully is to start small.Start by purchasing real estate with the little money you canraise i.e. (buy a boys-quarter, half plot, an office/shop unitetc).
Afterwards, gain the needed expertise you need tosource and manage big funds.In addition, start helping other people make profitabledeals; build your portfolio and before you know it, investorswill be on the look-out for you. You can as well use theprofit you make from helping others to buy more realestates.
Let others know you’re now a prudent expert, when itcomes to real estate in Ghana.
Know your Aim in Real Estate: Two Types of RealEstate Investments.
According to Robert Kiyosaki (thepopular author of theTimes best seller book “Rich Dad Poor Dad”) , when itcomes to investments, there are primarily two thingspeople invest for: capital gains and cash flow.
Capital Gains are the one-time profit you make on the saleof an investment. The strategy behind capital gains is tobuy and sell.
In order to realize capital gains, you must sellthe asset. As long as market prices go up, capital-gainsinvestors win. But when the markets turn down and pricesfall, capital-gains investors lose.
Cash Flow is an ongoing stream of income you receive froman investment. You may receive this money on a monthly,quarterly or annual basis, depending on the investment.The strategy behind cash flow is to buy and hold.
Our advice is to buy or develop properties that producecashflow and in few occasions depending on the propertymarket, you may completely sell off your property forcapital gains.
Real Estate Investing Tips
How to sight good deals from listed property for sale inNigeria.Below are my time-tested tips for any Ghanaian going intoreal-estate investment:
1. At first, invest more time than money: Don’t look forhuge deals requiring huge amount of capital, thinkingyou will make more gain.
Instead, invest more time insearching for properties and working alongside abroker/agent. You have to gain experience from smalldeals, so don’t jump stages.
2. Choose a property that is close to you: The worst realestate properties you can buy when you’re just startingare the ones very far from your home. Remember, beingsuccessful in a new business require first learning andgaining daily/weekly experience.
Purchasing a real-estate property where you hardly visit, is too risky for astart.
3. Fall in love with the area and not the house: Note thisdown! It’s the area that gives real estate the value andnot the house itself .
There’s no point building orpurchasing a nice hotel in a village, it’s of rare use. Inaddition, don’t be too attracted or attached to a realestate that you won’t be able to do without it. There isalways better deals to come.
4. Buy property that has problems that you can solve:
Amajor tip for newbies is that they should look forproperty that has problem they can easily proffersolution to.
Identifying problems and knowing the onesyou can solve is better than looking for sugar-coated orready-made deals.
5. Before entering a negotiation, have a maximum amountyou will pay: The maximum amount you can offer for aproperty is very important prior to entering anegotiation. If your offer is not accepted after reachingthe maximum limit you high marked, move on. There isno point using all the money you have to purchase aproperty and having nothing left to renovate, build ormarket it.
6. Know your broker very well and pay them well: Studyyour broker, is he an investor or a home buyer lookingfor fast profit.
Also, do pay them well or else they won’tget you better deals. As Robert Kiyosaki will alwayssay, “most people will either tip a waiter than tip theirbroker; that’s tipping someone who is costing youmoney, instead of somebody who is making youmoney.”
Haven read what it takes to be a successful real estateinvestor in Ghana, nothing will happen if you don’t buy anyproperty; so get up and start doing your homework asregards the next property you’re going to buy.