An unseen investment
Your best investment opportunity might not be just out your front door; yet travelling across Nigeria to inspect a property may not be an option either. So, is buying sight unseen a wise decision?
Smart investors look for opportunities anywhere. If they are in search of both capital growth and positive cash flow, many investors look well beyond their own backyard. They look at other suburbs, states and territories, including regional centers with strong fundamental growth drivers.
How to minimize your risk?
Buying sight unseen is considered a risky strategy, however many investors continue to make a lot of money using this approach. So how can you minimize your risk? The answer is doing your research and thorough due diligence.
Property investment is now much like buying shares. Although you might not sit in the boardroom of the company, you undoubtedly conduct comprehensive research and analysis.
The same applies to buying a property sight unseen. Fortunately, there are so many online resources it has given us improved access to other property markets. You can easily review and analyze local market reports, council zoning regulations, recent capital growth and current vacancy rates to create an overall understanding of the market you are looking at investing in.
With proper research you can pick the market, pick the locality and pick the entry point. Fail to do your research thoroughly however, and you won’t get a full understanding for a local market – regardless of location.
Being able to identify key growth drivers is a crucial part of the research and due diligence process and you will need to thoroughly research key drivers, such as employment and infrastructure development.
Practical ways to help you make a smart purchase
- Take a video walkthrough of the property
- Get a comprehensive land/building inspection with detailed report and photographs
- Discuss the property with a local property manager and get them to inspect it for you
- Get a property appraisal if the property is vacant
- Speak to local agents about the street and surrounding area
- Look at google maps and street views to help understand what is around the property
- Get an independent property evaluation
- Stick with your buying criteria – does this