When asked for investment advice, Mark Twain once commented, “Buy land; they’re not making any more of it.” The great writer’s advice remains true, even a century after his death, as real estate remains one of the smartest investments you can make, especially if you take steps to safeguard your investment, such as carefully screening tenants or hiring commercial or residential painters to spruce up your properties.
Commercial and residential investment provides many men and women throughout the U.S. with a solid stream of income. According to CNBC, real estate investing remains more popular among Americans than stocks and bonds.
About a quarter of Americans said real estate was the most favored investment option for long-term investments, beating stocks, which only 16 percent said was their favored investment vehicle for money they wanted to invest for over a decade.
Like any investment, there is risk involved with investing in real estate. There is a critical difference between the risk involved in investing in real estate and investing in stocks, bonds, and other financial products. Individual investors can do very little to counter the risks involved in investing in the stock market or other financial products. They can hedge their bets by diversification and other tactics, but they can’t personally intervene in market trends, geopolitical events, and other macroeconomic factors that impact the value of these investments.
Real estate investors have more tools to protect the value of their investments. Landscaping to improve curb appeal, renovations to increase value, and upgrades to ward off potential sources of damage are some ways real estate investors can directly control the value of their investments and ward off threats.
One of the most frustrating things about life is the lack of control that we have over many of the things that directly affect us. Real estate investing provides men and women with an opportunity to realize a great income from commercial and residential buildings and to directly influence the level of risk and reward by taking personal action.
Protecting Your Investment
Proactive property owners are prosperous property owners, as the work they put into their properties helps them prevent more costly repairs or expenses later. For commercial and residential investors seeking to protect their property and maximize its value, these helpful tips will allow them to minimize risk and improve revenue generated.
- Carefully screen your tenants – Weeding out tenants who are likely to be late on rent payments or cause damage to property in your screening process is one of the most important things you can do to safeguard your real estate investment. You or the property management company handling your property should create careful criteria for tenants and stick to that criteria to avoid undesirable tenants. Make sure that your requirements do not run afoul of any fair housing or anti-discrimination laws, however.
- Paint your property – A good coat of paint does a lot more than just improve your property’s aesthetic appeal; it can also protect wood or metal against deterioration caused by prolonged exposure to the elements. Rhino Shield SoCal, commercial and residential painters in Los Angeles, uses a specially formulated coating to provide structures with protection against damage from salt water and UV rays common to the southern California area. Rhino Shield SoCal’s residential and commercial coatings contain ceramic microspheres that make the coating more resilient than traditional paint. The coating reflects UV rays, lowers wall surface temperature, is resistant to mold and mildew, mitigates the impact of salty water and air, and can even bridge surface hairline cracks. Rhino Shield SoCal’s specially formulated coating outlasts traditional paint by many years and is guaranteed by a 25-year warranty, making it the smart investment for homes.
- Make sure you have the right insurance – Commercial and residential property face some of the same risks – fire, flood, natural disasters – but there are also some added risks involved with commercial property that you need protection against. Talk to an insurance agent or broker and ensure that you have appropriate insurance to guard your wealth against claims that may arise related to your commercial property holdings. Having proper insurance will spare you from the costs of unanticipated litigation.
- Prepare for disasters and emergencies – A good prep plan for disasters and emergencies can help you minimize your losses from these events. You should back up your computer files and keep important documents such as mortgage information, tenant contracts, insurance policies, etc. stored in a physical location and digitally in a separate location. You should also have documents of utility shut-off valves so you can provide information to your maintenance crew or public safety officials in the event of a crisis.
- Don’t get tripped up by tax problems – Keep your financial records clean and in order, and pay your taxes on time. More than one real estate investor has been tripped up by fines and penalties related to unpaid taxes. That said, don’t neglect to take advantage of legal tax deductions and corporate legal structures to minimize your tax burden. An accountant or tax lawyer can help you better determine your tax liability and provide solutions to reducing the taxes you are legally obligated to pay.
- Conduct regular inspections – Whether you’re a commercial real estate investor or you rent homes to tenants, regular inspections will help you ensure that your property is being well cared for by those renting it. Conduct an inspection when a new tenant begins occupancy and take photos to document the condition of the residence. Then, once or twice a year, conduct inspections to ensure that your tenant is living up to the conditions of the lease. Make sure your inspections policy is written into the lease, as are conditions requiring tenants to address issues found in inspections or vacate the premises.
- Improve curb appeal with landscaping – If your aim is to sell your property for a higher price, landscaping is a highly effective tool. The exterior appearance of your residential or commercial property is the first impression it will make on prospective buyers. By keeping the lawn trimmed and in good condition and planting attractive trees, shrubs, and flowers, you can vastly improve the curb appeal of even the most unremarkable commercial buildings. Also, an attractive exterior design and paint scheme can greatly improve the curb appeal of a home or business facility.
- Have a plan – Know what your specific financial goals for your real estate investments are and stick to them. Avoid the temptation to overextend and purchase properties you can’t afford. Overextended investors are often left financially unable to make the repairs and renovations they need to maintain and increase the value of their properties.
It’s also important to have a renovation and maintenance plan. By knowing the maintenance needs of your properties and planning for activities such as re-roofing, painting, installing new HVAC units, etc., you can control costs and head off problems that can grow to be more expensive if neglected.
By following these tips and other smart real estate investing strategies, owners of residential and commercial property can enjoy a stream of passive income that can supplement their work earnings or even provide a comfortable living for investors with extensive property portfolios. Rhino Shield SoCal can aid investors by providing a long-term solution to their painting needs while also helping to protect commercial and residential buildings from the elements.
Rhino Shield SoCal is a California painting company that uses a specially formulated coating to provide unmatched protection to commercial buildings and homes. Hundreds of satisfied customers can attest to the unparalleled value of Rhino Shield SoCal’s residential and commercial coatings.