Property investment remains one of the most powerful ways to build wealth, offering opportunities for both short-term gains and long-term financial security. However, success in real estate isn’t just about buying a property and hoping it appreciates in value. The most successful investors follow strategic approaches to maximise returns. Here are four key strategies to make money from property:
1. Buy Below Market Value – Make Money When You Buy
The first rule of smart property investment is to buy at the right price. Unlike stocks, where you make money when you sell, in real estate, you can secure profits from the moment you purchase—if you buy wisely.
- Look for distressed sales, mortgagee sales, or motivated sellers who need to sell quickly.
- Consider properties with minor cosmetic issues that can be easily fixed.
- Research market trends to find undervalued properties in high-growth areas.
- Negotiate aggressively to secure the best deal.
2. Add Value Through Renovations or Improvements
Another effective way to boost a property’s value is by making strategic improvements. The key is to focus on renovations that yield the highest return on investment (ROI).
- Cosmetic upgrades: A fresh coat of paint, new flooring, and updated fixtures can significantly increase a property’s appeal.
- Kitchen and bathroom upgrades: These are often the most valuable areas to renovate and can substantially raise the market value.
- Adding bedrooms or living spaces: Extending or reconfiguring a property to increase usable space can make a big difference.
- Enhancing curb appeal: Simple landscaping, a new front door, or an exterior facelift can attract higher-paying tenants or buyers.
3. Hold Long-Term – Benefit from Capital Appreciation and Rental Income
Real estate is one of the best long-term investments, as property values typically rise over time while rental income provides ongoing cash flow. Holding property long-term allows you to benefit from:
- Capital appreciation: Over time, property prices tend to increase, driven by supply and demand.
- Rental income: A well-located property can generate passive income while covering mortgage and maintenance costs.
- Inflation hedge: As inflation rises due to central banks’ money-printing activities, especially during crises such as the Global Financial Crisis (GFC) and COVID-19, the value of money devalues. As a result, property prices and rents typically increase, helping protect your wealth.
- Leverage: Using borrowed money to invest in property allows you to control a larger asset with a relatively small initial investment.
4. Sell Strategically – Take Advantage of Buyer FOMO (Fear of Missing Out)
Timing your sale can be just as important as buying at the right price. Selling in a hot market can significantly boost your profits.
- Market cycles: Monitor property market trends and economic indicators to identify when demand is high.
- Create competition: If selling at auction, encourage multiple bidders to drive up the price.
- Stage the property: Presenting the property in its best light can increase perceived value.
- Highlight unique features: Emphasise aspects that make the property stand out, such as views, location, or recent renovations.
Final Thoughts
Making money in property isn’t about luck—it’s about strategy, research, and execution. Whether you’re looking to build a rental portfolio, or simply make smart investment decisions, these four principles can set you on the path to real estate success. By buying wisely, adding value, holding long-term, and selling strategically, you can maximise your returns and create lasting wealth through property investment.
