Many people dream of having financial peace of mind, but not many of them can achieve it. While most individuals want to live off their savings without working, they don’t have any concrete strategy to achieve that goal. So, the first thing that you need is a robust strategy that gives you the best odds of achieving your objectives while investing in the Sharjah real estate market.
And one such strategy is building diversified investment portfolios that give you sustained growth in the long term. When it comes to building an investment portfolio, we simply cannot ignore how important it is for you to include real estate.
Not only does it allow you to benefit from the amazing returns, but also gives you the room to invest in risky investments. This is because growth in the real estate market will allow you to offset the losses that you might incur with risky assets.
Hedge Inflation by Investing in Property
One of the biggest reasons why you should invest in the property market is that it is a great way to hedge inflation. Fiat currency will lose value over time since its purchasing power will continue to erode with increasing inflation. But investing in real estate means that its value will continue to increase.
This means that your money will retain its value over time that it would have otherwise lost if it was in cash. Furthermore, there are rarely any instances where real estate prices might see a huge price movement in a short period.
Stocks and the crypto market see a lot of price movements throughout the day. Therefore, it might not be a suitable option for someone who is projecting long-term growth. Investing in real estate gives you long-term sustainability and saves you from worrying about frequent price movements in other asset classes.
Additionally, real estate can be considered as a safe-haven asset. Many intangible investment options will quickly lose their value in case of an economic meltdown, or geopolitical instability. However, that is not the case with real estate since it will continue to retain its value. Plus, a market like Sharjah has always been a key hotspot for investors.
Diversify Your Property Investments as Well
There are two things that you need to consider for building a diversified real estate investment portfolio. Firstly, you need to invest in different properties in locations throughout Sharjah. Location plays a major role in the return you can enjoy on your property investment.
Moreover, the type of property (residential and commercial) you invest in is also very important. Try investing in different types of property to diversify your real estate investment as well.
The second important thing to keep in mind is that you shouldn’t over-invest in the Sharjah real estate market. Most of the wealth built in the United Arab Emirates is by investing in real estate, particularly after the Covid-19 pandemic.
With the economy seeing substantial growth, housing prices are following the same track. As a result, the average home price saw a significant in the last year. Many people believe that this growth trajectory will continue since there is a high demand for the property.
There are a large number of new projects underway and the government is giving away investment schemes, such as the UAE Golden Visa. Under this scheme, investors are encouraged to buy homes, villas, and apartments that are worth more than AED 2 million.
Can the Property Market Sustain its Growth?
Many people believe that the country’s real estate market will continue to enjoy the same growth. Though the country does offer a zero percent income tax policy that makes it a good investment avenue, it is important to see the bigger picture.
If you zoom out, then you’ll notice that the growth in Sharjah and UAE’s property sectors tends to be cyclical. While it did reach new highs in 2008 and 2015, the market corrected by 2010 and 2020. So, there is no guarantee that the upwards trend is everlasting.
Building a diversified real estate investment portfolio can help you enjoy long-term growth. Most importantly, the rental income that you get from these investments will give you financial freedom. It will allow you to make money without having to work.