Property Prices May Fluctuate #

It’s natural to believe that with rising property prices, purchasing a house and sitting on it will ensure a return. However, things are not always that straightforward. Remember the 2007/2008 boom and bust? Following the collapse, several properties were valued less than half their original value and have yet to return to their prior peak.

Additionally, there are expenditures associated with maintenance and renovation, as well as a ceiling value to consider. Specific properties will never sell for more than a certain sum owing to the location in which they are situated. These are some factors to consider while purchasing investment properties.

Kunda Group does not eliminate any of the dangers that you may encounter if you purchase a residential home outright from a developer (i.e. without a mortgage). By virtue of the fact that you have no control over your day-to-day choices and the time of your leave, you put some extra risks into the equation.

We recommend you to diversify your assets over a number of properties in order to avoid excessive exposure to any one property, which might result in concerns such as tenant default or a condition particular to that property that has an influence on its value if it is not managed properly.

Inability to secure a suitable tenant #

It goes without saying that investing in buy-to-let properties is an excellent way to generate a consistent stream of income to meet expenses such as maintenance and mortgage repayments. But what happens if you are unable to locate a renter willing to rent your house at the price you desire?

An unoccupied property, whether commercial or residential, will quickly become a significant financial burden rather than a profitable source of income.

While Kunda Group predicts gross rental revenue based on third-party data, they are not guaranteed. It is possible that reduced rents will be acquired. Additionally, rental revenue may halt entirely at specific seasons. For instance, if an uninsured fire occurs, Kunda Group has the right to get a loan secured against the underlying property to repair the damage. This loan must be repaid from future rental revenue.

Liquidity #

While you may post your investment for sale to other Kunda House members at any time, you should keep in mind that there may be no one ready to purchase it at the price you consider appropriate (or buy it at all). In such case, you will be compelled to wait until the property’s listing on the Kunda House platform reaches its fifth anniversary. Even at this stage, the timing and ability to depart are contingent on the successful execution of a deal.

Variable Earnings #

Take caution not to over-invest in property investment. While investing the bulk of your money in property may seem to be a smart investment, if your savings are locked up, it may be difficult to access them if you suddenly want them. After all, selling a house is a lengthy process.

Disposal/surprising departure #

Kunda Group maintains the right to sell the properties and reinvest the revenues. Along with the risk of receiving much less than invested, the timing may be unfavourable, resulting in the crystallisation of taxable income earlier than intended.

There are other risk involved in property investment which are not mentioed in this artciles which can be found here