Investment in this region of the world is expanding, which is driving prices up and making it an attractive investment

Entrepreneurs tend to have diverse backgrounds and rarely come from one that offered a financial education. So when they find a bit of early success, whether making $1,000 or $100,000, they usually do not know where to go from there. They will might spend it or put it in the bank, but few consider investing it in real estate. Almost all will overlook the tremendous potential of real estate investment and technology in Southeast Asia.

After a small downturn, real estate in places like Singapore are primed to explode. Investment in this region of the world is expanding, which is driving prices up and making it an attractive investment. This is making Southeast Asia a leading real estate market, with the resources to merge this opportunity with crafty startups.

While real estate can be a complex investment option and requires learning a number of different industries and skill sets, it is a great vehicle for wealth creation. Serial entrepreneur Zamir Kazi is a classic example: Three years ago he bought 6 apartment units for $60,000 and grew that initial investment into a portfolio of over 400 apartment units worth more than $12 million.

According to Kazi, real estate is a largely project-based investment class, which allows entrepreneurs to add enormous value with each project. Because banks have standardised mortgage processes, it is easy to work with more money than you actually have. If you’re an entrepreneur considering what to do with your wealth, here are some of the top reasons Kazi gives for investing in real estate.

1. Low barriers to entry

People tend to believe investing in real estate is an expensive proposition and never look into it because they think they do not have enough money. Banks offer mortgages with as low as 3 percent down at signing for first-time home buyers, but more realistically you only need to have about 10 to 20 percent upfront. Thus, even $5,000 could allow you to buy a house worth $50,000-250,000.

Additionally, since real estate is everywhere, there are many different markets, types of real estate, and industry players that make it easy for anyone to enter. You will need to find a realtor and a contractor, or learn how to do repairs yourself, but you have the luxury of being able to talk to dozens of realtors and contractors before picking someone to work with.

2. Stable returns

There have been plenty of major real estate bubbles and housing price cycles. However, if you do your due diligence, whether you aim to fix and flip homes or rent them out, there will be stable returns. With a fix-and-flip property, you are looking for a cheap property you can do small repairs to and create a drastic increase in price, which means your investment returns have nothing to do with the market conditions if you work quickly.

Maintaining a rental opens you up to some market variance, but also offers a consistent source of passive income, which is a different form of stable returns. Overall, real estate allows entrepreneurs to pick a general approach to their investments and reap stable returns, either through value creation or passive income.

For example, according to Singapore Business, Singapore’s real estate market will reach $48 billion this year. It seems that investors all over the world are chomping at the bit to invest in real estate. The sector saw 55% growth during 2017.

Also read: Proptech is the next big thing, but it is more complex than you think

3. Common sense leads to success

According to Kazi, the biggest secret to success in real estate is simply using common sense. Ultimately, he thinks about where people are living and what types of homes they are buying. If he sees an increase in prices, he asks whether people are actually willing and able to pay those prices, or if the prices will likely go back down.

Simply put, think about which real estate locations are going up and down in value, and about why that is happening. Using the knowledge of your hometown dynamics can help you pick local properties in a market you already know.

4. Ample resources available

As you contemplate how to get started, note that that successful real estate investors are typically willing to serve as mentors. Reach out to people who have years of experience and ask them to share some wisdom. Especially if they have worked in your market, they can keep you from making rookie mistakes.

Additionally, there is endless information online for any type of real estate skill you might want to learn. Whether you want to learn how to do an intensive kitchen rehab or need more information about the brokerage process, there are online resources to help you learn more. Take advantage of these resources and use your spare time to build up the competency you need to begin investing in real estate.

A bank loan can turn a small amount of capital into a large working sum and a well thought out project can generate huge returns. With some hard work you can begin investing in this lucrative industry with just a few thousand dollars.

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