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Is it Better to Invest in Smaller Real Estate Properties?

Investing in smaller properties is truly beneficial, but this by no means indicates that investing in bigger or expensive properties is not profitable. It simply means that smaller properties are low-risk investments and are easier to buy and sell whenever the market shows good profit margins for the investor.


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Kiran Shabir

3 years ago | 4 min read

People invest in real estate for two reasons one for personal residence and the other is to resale for profit. Both of these choices involve making certain decisions regarding the property to purchase that checks out most of your boxes. It may be a head-scratcher if you are buying a personal home for the first time. You have to establish a budget for the property and consider a lot of additional expenses, for example, buying furniture, furnishings, etc. But if you are investing in property as a lucrative business venture, your only consideration is to go for the properties that are in demand and can be sold with good profit margins.

People investing in real estate tend to go big if they have the budget for it. The reason for choosing a bigger house or a luxury 3 bedroom flat for sale in Lahore would make them a bigger profit. While this may be true, the buyer’s interest in bigger properties has to be weighed in. In this day and age, people have checklists and priorities that are important factors for making a final decision. In short, large properties may not be as easy to buy or sell for profits as one might think. In comparison, the smaller properties sell at a much faster rate. There may be multiple buyers for it as smaller properties are more affordable for purchase and are always high in demand.

Benefits of Investing In Smaller Properties

Residential Benefits

Following are the benefits of buying smaller property for personal residence instead of spending too much on space that you do not need:

Preferences

A vast majority of real estate investors choose to buy the properties with just enough space that they need. For example, if a 2 bedroom apartments for sale in Lahore ample space for them they should not go for a bigger flat or a house. Instead, they could choose a better-valued property or a location that offers other benefits instead of just more space.

Affordability

Smaller properties are affordable and can be bought without having to break the bank. The money saved by not splurging for the biggest place can be kept safe in the bank until it is needed or invested elsewhere.

Decoration and Maintenance

In comparison to the bigger properties, the smaller ones are much easier to decorate. They have much lower maintenance requirements as well. The owners do not have to spend too much money on decorating smaller spaces. The same goes for their cleaning and maintenance.

Luxury and Exclusivity

Some investors choose to go for smaller properties that offer better value in terms of other facilities. This means that if people have the choice between buying a house or 2 bedroom flat for sale in Lahore but in an exclusive luxury building such as Union Luxury Apartments located in the gated residential community of Etihad Town. They would generally choose the one that offers more value, i.e. an exclusive luxury residence with the security and other amenities an upscale gated community has to offer. This way they are compromising on size to get elite residential experience.

Realty Benefits

These are some well-known benefits of investing in relatively smaller properties:

Profitability

Real estate investment can prove to be a lucrative business if the benefactor takes the right steps to boost the profits. By following the right real estate market trends, investors can boost their profits. Buying smaller properties is better as they sell better and much faster. This can be the first step towards the goal of increasing your profits.

Diversification of investment

Putting all your eggs in one basket is never a good idea. Especially when it comes to real estate investments, it is best to diversify your portfolio as much as possible. This means buying multiple properties at different favorable locations would be a better approach. Instead of one big property that ties up your money for an extended period as it takes time for properties to gain value and become profitable.

Affordability

Big cities have higher prices for properties especially if you are buying a house. As compared to houses, a 2 or 3 bedroom flat for sale in Lahore offers much better value as they are easily affordable and the investor can buy two flats for the price of one house. Smaller properties such as apartments and flats for sale are highly in demand these days. So it would be a good idea to go for two smaller properties instead of one big house within the same budget.

Quick Resale

The bigger the property, the difficult it is to sell. Similarly, if you have smaller properties, they are easier to sell especially apartments and flats for sale. Selling a big property takes some time and can be problematic when you find yourself in need of some cash. However, smaller more affordable properties would sell faster whenever the need arises to liquidate some assets and they will make a solid profit for you.

Investing in smaller properties is truly beneficial, but this by no means indicates that investing in bigger or expensive properties is not profitable. It simply means that smaller properties are low-risk investments and are easier to buy and sell whenever the market shows good profit margins for the investor.

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Kiran Shabir


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