Real estate is one of the best investments you can make.
It’s one of the biggest and most economically active markets here in Jamaica. The fact that you’re reading this means you’re thinking of investing in the Jamaican real estate market.
If you know what you’re doing you will do very well. But, like any investment, things probably won’t go as planned.
As a real estate investor you want to minimize your risk as much as you can.
Here are some things you should look for before doing real estate investing in Jamaica.
1. Don’t be discouraged by ‘no’
Real estate investors are notorious for their tenacity.
No matter how many “No”s an investor hears, they refuse to give up on finding the perfect deal.
The more times one gets rejected by sellers or landlords, the more financially difficult it becomes to be approved.
As an investor, you’re in the trenches every day and not everyone will see your genius vision for what it is.
Don’t allow a string of “No”s to discourage you.
There are always some real estate gems in Jamaica, you just have to find them.
2. You can never have too much money
You might think that the goal of every investor is to find a great deal on a property.
After all, who doesn’t want a big financial win?
In reality, many Jamaican real estate investors are simply trying to make back their initial investment.
If they can break even or turn a profit by selling the property, great!
But if not, who cares?
It’s just a small initial investment. If you’re going to be a successful real estate investor, the golden rule is that you can never have too much money.
You should always have enough saved up to purchase one or two more investments if an opportunity arises.
In other words, get in the habit of saving your “house money.”
3. Be aware of where your strengths and weaknesses lie
It doesn’t matter if you’re buying a distressed property from a Jamaican bank for pennies on the dollar or a multi-million dollar home.
Knowing what type of property to buy is crucial.
You can spend all day long researching different properties and looking through real estate listings, but at the end of the day it isn’t going to help you determine your personal expertise.
Are you better at finding cheap houses or luxury homes to flip?
Do you like dealing with the public or would you rather work behind the scenes in rental properties?
No matter what your expertise is, stick with it and find ways to improve. If you’re not great at research but enjoy restoring properties, try taking a few courses online or hiring someone to do it for you.
4. There’s no such thing as ‘the perfect deal’
As real estate investors, we often get wrapped up in finding ‘The Deal.’
The one that will make us rich, but there is no such thing!
Sure, if an opportunity comes along that allows us to buy a property for 20 cents on the dollar and sell it two years later for 50 cents on the dollar, that would be great.
But those types of opportunities are scarce and they don’t usually happen very quickly either.
Make it your goal to find a decent Jamaican property to invest in first, then wait for ‘The Deal’ to come along.
The first deal you flip will teach you everything you need to learn about real estate investing too.
5. You must have vision
Without vision, how else are you supposed to purchase properties?
If you can’t visualize what something will look like in 3 years, you might miss out on some sweet deal.
Jamaica is a developing country which means more rural areas will slowly be commercialized due to more highway roads being built.
For example, the new road being built from Savanna-la-mar to Montego bay, will open up a lot of opportunities for commercial and residential investments.
6. If it seems too good to be true, it probably is
If someone is offering you a Jamaican property for pennies on the dollar with nothing down and 50% returns, that should raise some eyebrows.
Why would they give away their hard-earned money?
There’s always way more involved than initially meets the eye. If something looks too good to be true. well, you know what happens next.
7. Don’t be afraid to get help
You can spend all day researching and scouring the Jamaican real estate listings on Google and still not find something good.
What’s worse than that?
Being so discouraged by dozens of “No”s that you eventually stop searching altogether.
That’s what happens when you try to do it yourself.
No matter how much research, legwork or number crunching you do, it doesn’t matter. You need a local Jamaican real estate expert to help you out.
Don’t be afraid to outsource some of your work.
8. There are no shortcuts
No matter how much experience or knowledge you have, there are always going to be times when the best decision is the hard decision.
It’s easy to look back on a deal later and think “I should have done this instead.”
But what about reality? What if that wasn’t an option at all.
Then where would that leave you? If real estate investing was easy, everyone would do it!
The sooner you learn that shortcuts don’t pay, the better off you’ll be in real estate investing.
9. Location, location, location! (Or rentability)
Most new real estate investors want to make money right away, but that’s not how it works.
You can’t magically make a Jamaican property profitable when you buy it, so do your research beforehand and target properties in the best possible areas.
This isn’t just for safety either.
Location is one of the biggest factors when it comes to rentability. If you’re planning to turn around and sell the property, be sure that there are enough people who want to live right where you’re buying.
For example, parishes surrounding Montego Bay (the tourism capital of Jamaica) are good places to look for property as that city has the most economic activity in the western part of Jamaica.
10. Don’t get caught up in the chase
It’s easy to get so excited about any type of investing that you run around like a chicken with it’s head cut off, trying to do everything all at once.
We always hear “be patient” but what does that really mean? Sometimes you need to keep your feet on the ground and act rationally instead of emotionally.
If deals aren’t falling into your lap yet, just wait for them.
Don’t be discouraged or make impulsive decisions while you’re running on emotion.
You can’t raise rents by charging more for less (for obvious reasons), so if you don’t want people complaining about how expensive your property is, make sure they can afford it.
11. Don’t be afraid to walk away
Even if you find a great Jamaican property at an amazing price, there might be times when it’s not worth buying after all.
And that’s OK.
Life is too short to settle on deals that would just waste your time and resources.
You’ll be kicking yourself six months down the road if you buy something and then realize you could have bought something better instead of wasting your time with this one. It can happen to anyone.