When experienced home buyers purchase real estate they know that they can not only protect the value of the property from eroding but also increase the value of the property. How do they do it?
Let me let you on in the secrets of home buyers who buy many high end properties and how they maintain the value of the house over a period of time so that when it is time to sell they are able to sell it at a huge profit.
First of all when buying a large home whether an apartment, penthouse, duplex or a bungalow you have to understand what you are getting into from a maintenance point of view. Most buyers do not pay as much attention to the upkeep and maintenance side of the purchase of a property as much as they do to the mortgage and investment aspects. You should not just buy a property worth tens of crores and leave yourself open to maintenance shocks and surprises after you buy it!
Do Thorough Research Before Buying
Before buying expensive properties I have seen buyers of such properties do tons of research. They have qualified experts on their team who go through and inspect the property so that they will know what to expect. If the current owner tells them that they will need to do a major paint job after buying the property they don’t just think, “That’s ok. I will worry about it later”. They plan for these things during the time of purchase. How? By either negotiating a better price with the owner, by putting money aside or by passing on that property and looking for a property that does not require a major paint job soon.
Contrast that with the typical buyer who checks a property himself even though he is not qualified to check for construction and plumbing work. Worse he asks his teenage college going children to check up on the new purchase! The experienced home buyer / investor knows how important it is to have qualified professionals do the research work and not friends and family who might be willing to pitch in but are not qualified at all in inspecting a property thoroughly before purchase.
Keeping Home in Ready-to-Sell Shape
When experienced property investors buy a property they maintain it so well that if it can be ready to go on the market for sale any time even though they may not want to sell it currently. They always have a plan for proper maintenance of the property and if it’s a bungalow – it’s grounds, gardens, pool, plumbing systems etc. They ensure that their property is always in a neat and trim condition – painted, clean and well-maintained. Very rarely will you see experienced investors buy a high end property for tens of crores of rupees and then let it fall into disrepair.
Rather these set of investors know exactly what it will take to maintain such properties and take immediate steps – like hiring gardeners and handy men to regularly inspect and maintain such properties. They also ensure that they have enough cash available to finance the maintenance and personnel costs that may include either a maintenance company or a full-time caretaker. The whole idea is to keep the property in perfect condition so that whenever they decide to use it personally or to sell it – it is ready to be shown to customers!
This attitude is part of the larger lifestyle habits of rich people who know that whatever be the purchase – whether a house, private jet, car or a yacht – they need ample funds to maintain it. Such possessions can be very maintenance-heavy. Having a yacht for example can cost 20 % of the purchase price every year just to maintain it. And for private jets it can be much more than 20 %! But these set of investors know that its all worth it in the end.
Ownership is a Journey Not Destination
A lot of buyers buying homes at the lower end of the market think that a property purchase is a destination. They think, “Once I buy this house everything will be great. I can just move in and enjoy my life.”
But high net-worth buyers have a different take on this process. They view the purchase of a property as a journey and not a destination. After buying the property they keep their focus on the maintenance and renovation aspect of the house. These owners know the importance of regular maintenance of a house even if they are not going to be living in it whether it be repairing leakages, upgrading the sewage system, trimming the lawns and so on. Even while they are making plans for purchase of a property they are also planning for the overall experience of ownership!