NTARE REAL ESTATE INVESTMENT OBJECTIVE, POLICIES AND STRATEGIES
Our investment strategy is what guides the Ntare decision making process based on goals, risk tolerance, and future needs for capital. Some of our investment strategies seek rapid growth where we focus on capital appreciation, or we can follow a low-risk strategy where the focus is on wealth protection.
At Ntare, we took the time to review our investment strategies and with feedback from some of our biggest investors, we decided to put up a think piece about what we are looking forward to in 2020.
Investment Strategy and Risk
Risk is a huge component of an investment strategy. Some individuals have a high tolerance for risk while other investors are risk-averse. One overarching rule, however, is that investors should only risk what they can afford to lose. Another rule of thumb is the higher the risk, the higher the potential return, and some investments are riskier than others. There are investments that guarantee an investor will not lose money, but there will also be minimal opportunity to earn a return.
Experienced investors may prefer and be comfortable with a buy low and sell high strategy, whereas investors who have less time to research and follow the market might benefit more from investing in funds that track the market and adopt a long-term view.
There is no right way to manage a portfolio, but we behave rationally by using facts and data to back up decisions by attempting to reduce risk and maintain sufficient liquidity for our clients and our own portfolio.
These are the two segments in which we believe we will be able to capture the biggest gain in 2020 and will be setting our sights on their potential to increase our capital and profit margin by the end of the year. Our goal is to invite select members of our community of clients and investors to put the required funds in an investment pool with a dedicated management plan. These funds will be used to furnish the actions taken the following segments.
1. Rental Properties
The first way we are going to tackle investing in real estate is also the most popular one – buying an investment property to rent out to others. We are going for a traditional, long-term rental or a vacation, short-term rental. The most important advantage of this investment strategy is that we will start seeing a return on the funds invested right away – as soon as the property is purchased, put into rentable shape, and tenants are added. As long as you repair your property on time and are able to keep good tenants, you will have a reliable source of monthly income. Another major benefit of this strategy is that it will allow us to grow quickly. We can use the rental income from your first property to buy another one, and so on and so forth.
The Ntare Investment portfolio goal is to have 100 rental properties by the year 2030 with a net return of 20-25% p.a.
The main drawback of investing in rental properties is that it is an active investment endeavor. We will have to maintain the property regularly, respond to urgent tenants’ requests and complaints, collect rent on monthly, deal with occasional evictions, etc. However, even this issue has been priced into our investment strategy as we will set up a professional property management that will ensure that all the action is within house . In most cases the fees you pay to a property management company are worth it as these professionals will be able to find you the best tenants and keep your property in an upmost state, by curtailing that step, we will be in shape to create several income streams that can sustain a noteworthy investment strategy for us and our clientele.
The key to success with rental properties is buying a profitable property in a top real estate market. To achieve this goal, we have conducted both a real estate market and an investment property analysis to know exactly how much rental income will be made (depending on the rental strategy) and how much return will be seen. We will be going for positive cash flow properties from day one as we intend to collect a portion of the portfolio amount from investors, add our capital and provide insurance.
2. Real Estate Investment Trusts
Ntare Consulting will also diversify its real estate investing portfolio in REITs. With this strategy, we will do our due diligence by researching and interviewing the best REITs and managers we can find. We have also done research on the best time to buy and the right time to sell the shares when the time comes. The potential for return is significant, and we will be able to make money in both the short and the long term.
Investing in a REIT is very similar to investing in stocks or shares, it is a long term situation and will not be for those investors that wish to see a quick return on their investment. So if you have a passion for real estate and want some hands-on experience, this is not the optimal strategy for you.
Ntare Consulting is a small business consulting agency that also provides investment solutions for the clients it has. We take the time to make sure our advice is sound and invest our own funds in the same strategies after careful analysis and vigorous vetting of the entire chain of actions including an exit strategy.