For those who are going to make an investment in property, they need to have a clear understanding of what property investment is.

What is the Purpose of Investment Properties?

Investment properties are those which have the ability to provide a return on investment to the investor. The intention of buying this type of property is so an individual or a group can make money from it. This can be bought with the purpose of an immediate return on the money invested or in the long term. Or in many cases both.

Types of Investment Properties

There are different types of investment properties. When a person buys the home they are going to live in this is actually an investment. Even though they are going to live in it themselves. Over a period of time, the house will increase in equity. If held onto long enough then when sold it should return more money than what was paid for it.

In many cases, those who want to invest in property will consider buying a second home with the intent of renting this out. This puts them in a position for both a short and long term investment. The short term will be money generated from the rent. The long term will be when they sell the property.

Another type of investment property is to buy multi-units for rental. Such as duplex for example. This is like a small apartment building. Then, of course, there is the option for buying larger apartment buildings.

Another option is the purchase of raw land. Some investors buy this type of property in areas that are as not yet being built up. They have done their research and believe that the land will grow in value when it is needed for expansion.

Commercial property investment is another option. There are several different options for property investment.