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Careful property investment
Easy access to facilities: A luxury bedroom of an apartment in South Jakarta
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span class="caption">Easy access to facilities: A luxury bedroom of an apartment in South Jakarta. More young families enjoy living in apartments that are close to their workplaces and other public facilities.
When investing in property, you think of two benefits: capital gains and rental income. However, just like any other investment instrument, property also has its risks. Without a proper investment strategy, investments can also go sour.
In order to maximize your profit, a number of things need to be taken into consideration. Before you do anything, let us look at the performance of apartments in Indonesia.
According to research and data by Colliers International Indonesia for the second quarter of 2015, as reported on kompas.com, Indonesia's rental apartments (both serviced and not serviced) remained stable at 75 percent.
Occupancy of rental apartments in the Jakarta area during the first two quarters of 2015 stayed within the 75-80 percent range, while apartments in non-prime areas ranged from 69.8 percent to 70 percent.
The potential benefits of apartments resold before the entire building was complete ranged from 30 percent to 50 percent. Meanwhile, apartments sold back within two to three years after being built reached 50 percent to 80 percent.
According to data by Colliers, the performance of these apartments, especially ones in high-demand areas, can be used as an investment opportunity. However, this picture must also take profit and loss calculations into account.
The option to rent is usually taken by investors who aren't in a hurry to sell their properties. They expect periodic benefits from the incoming rent. You can get the most optimal annual yields by determining the proper rental rates.
The trick to do this is to look for information around the area. Look at the standard rental rates and the capabilities of tenants in the area. Then calculate the costs for the rental apartment and factor in these costs when determining rates.
Note that optimal profits can't be obtained by simply considering the differences between buying and selling prices. Don't forget to calculate costs incurred after a purchase. These additional costs are often forgotten even though they can accumulate into a large amount.
