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3 Reliable Ways to Protect Your Real Estate Asset

Photo by Binyamin Mellish from Pexels

Your real estate asset is likely one of the most valuable assets you own. However, unlike other assets – like bank accounts, investment accounts, or liquid cash – it’s important to understand that the value of real estate assets can be threatened from a few different sources. 

First, like any asset, it might depreciate. But, because it’s a physical object, it might also be threatened by natural disasters, criminals and thieves, or just a fluctuating market. In this post, we’re going to cover 3 reliable ways that you can protect your asset, so you never have to wonder if that part of your net worth is under threat.

Invest in security systems and insurance

First, your personal property must be protected from physical threats like burglars or natural disasters. In order to do this, you must invest in the tech that it takes to keep your property safe. Here are a few different examples:

  • Alarm systems that alert you via phone if there is an intruder on the premises
  • Camera security that allows you to ID any criminals who may trespass on your property or steal anything from it
  • High quality locks, windows, and fencing systems that can effectively stop intruders from entering

Your asset can significantly lose value if damaged, which makes keeping it physically secure a priority. However, in the real world, not everything is preventable; sometimes, a storm might damage a roof, and earthquake might disrupt a foundation, and a burglar may not be apprehended. 

Because of that, in addition to investing in security for your property, you should also invest in high-quality insurance that will compensate you in case something bad happens to your asset. Insurance may seem expensive, but most plans work on reasonable month-to-month payment plans – plus, there’s nothing more expensive than losing your entire asset to a tornado that blew through town without any warming. 

Prioritize rental property protection

Many property owners and managers don’t just buy assets and hold them; they actually rent them out to renters, whether it’s a residential apartment complex or a business location rented by a local company. 

It’s also important to protect your asset from tenants who might be disrespectful to your property, or whose business might damage the building. That’s why it’s critical that you implement background checks before allowing anyone to rent out your property. 

A good background check should provide you with ample information about your possible tenant. That includes information like;

  • One of the best credit check for landlords
  • A through criminal background check
  • Employment history including earnings reports
  • Past rental history and any complaints from previous landlords about a particular tenant

Once you’ve performed thorough background checks, you can rest a little easier knowing that you’re only allowing more trustworthy tenants to live or work in your property. 

You can also help to protect yourself from any damage a tenant may cause by requiring that they pay a security deposit. Then, if they do damage the premises, when they move out, you can simply not pay back the security deposit, and use it to pay for the repairs that the damage required. 

Always keep an eye on the market

The last way that you should protect your real estate asset is by keeping an eye on the market. This is one of the most difficult kinds of value loss to protect against, as it’s hard to see coming, and no insurance or security system will protect you from a market downturn. 

However, by keeping an eye on the market, you keep your options open. If you see that a seller’s market is approaching – that’s a market where sellers can expect high returns on property sales – then you might consider liquidating the asset and retaining its value. 

Alternatively, you might choose to wait out a bad market in hopes that, once the downturn has passed, you’ll recuperate any value that your property lost. 

Either way, keeping an eye on the market allows you to make an informed decision about how you plan to protect the value held in your property asset. Flying blind would mean that you never know how much your asset is truly worth, and you may be unable to plan financially as a result. 

Property is one of the most valuable assets that many people own. With the right security measures, it can continue to be.

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