Where should a beginner real estate investor start?

Real estate investment is not a short-term game of getting rich quick, but a long-term game of protecting and growing assets. For those who value principles and trust in particular, a sense of security and sustainable growth in the future will be more important than immediate profits. This section explains what inexperienced or novice individual investors in real estate investment should tackle first. Fromclarifying objectives andunderstanding risk and return, to criteria for property selection, choosing a reliable partner, and the purchase process andlong-term growth perspective, we have compiled a list of key points for beginners to keep in mind. We have tried to explain technical content in as simple a manner as possible, so please take the time to read it carefully and make the most of your first steps in real estate investment.

1. basic concepts that should be understood before starting real estate investment

When a beginner embarks on a real estate investment, it is important to organize the basic concepts and mindset before starting to search for properties in the dark. Below are some points to keep in mind before starting.

• Clarify the purpose of investment: First, clarify "why you want to start investing in real estate. Everyone has their own motivations, such as building funds for retirement, expanding assets, or securing a stable income. The appropriate investment approach and property type will vary depending on your objectives (i.e., whether you want a steady monthly income or a long-term increase in asset value, etc.). It is also important to understand your own risk tolerance. The property you choose will depend on whether you are willing to take some risk and aggressively aim for a return, or whether you want to focus on stability and avoid large losses. Those with a high risk tolerance can consider aggressive investments, such as a single used apartment or a high-yield property in a rural area, while those with a low risk tolerance can invest in a solid property such as a condominium in the city center. In real estate investment, expected yield and risk are two sides of the same coin, and it should be noted that properties with high yields tend to have high vacancy risks.

• Understand the difference between a "residential perspective" and an "investment perspective:" Although real estate is familiar to you for your own residence, the axis of thinking differs between purchasing yourown home andpurchasing a property for investment. When choosing a home, you focus on your own preferences in terms of floor plan, interior design, and comfort of the surrounding environment, but in the case of investment, you must place the highest priority on rental demand andprofitability based on the premise that you will "rent out" the property. For example, even if you create an elaborate interior that suits your taste, it will be meaningless if it is not attractive to tenants. Even if you spend a lot of money on facilities, it may be wasted if they are not desired by the tenants. It is important to select a property calmly from the viewpoint of "yield" without forgetting the premise that "I will not live there. The following are examples of different viewpoints for residential use and investment use.

  Perspective/Item	Real estate for one's own residence (residential use)	Real estate for earning rental income (investment)
  Primary Purpose	Primary objective is to live comfortably for oneself and one's family	To earn rental income by renting it out to others and to increase the value of the asset
  Points to focus on	Preference of floor plan and interior design, convenience of living, comfort of living environment	High rental demand, yield (profitability), future potential of asset value
  Financial planning	Use a mortgage loan (low interest rate, tax breaks available) and pay off the loan over a long period of time without difficulty.	Use an investment loan (higher interest rate, no tax breaks). Plan to use rental income to cover loan repayment and expenses and increase income.
  Decision-making stance	Comprehensive judgment, with emphasis on lifestyle and sensitivity	Focus on numerical data and market trends to make objective decisions without being influenced by emotions.

• Learn the structure and risks of real estate investment: Once you have established your investment objectives, learn all the basic structure, terminology, and related laws and regulations. At a minimum, you need to know how to calculate yields (the difference between surface and real yields), how loans work, and the laws related to rental management (the basics of lease contracts and the Land and Building Lease Law). Knowledge is the best defense. If you leave it up to the agent without knowing anything, you run the risk of getting a disadvantageous property or being forced to sign a wrong contract. In fact, unfortunately, there are malicious contractors who take advantage of beginners' lack of knowledge to forcefully sell properties for their own profit. Be wary of investment talks that offer sweet promises of "just now" or "you will surely make money," and ask for explanations of anything that is unclear until you are fully convinced. The basic premise of avoiding future risks is to arm yourself with knowledge through continuous study of books and seminars. 2.

2. initial preparation for beginners

Once you understand the basic concept, the next step is to make specific preparations. Before looking for a property in the dark, take steps to get your feet on the ground.

• Review of family finances and financial planning: First, identify your current income and expenditures, and figure out how much personal funds you have that you can put toward investment without strain. Review the balance between your living expenses and other debts (mortgage, car loan, etc.) and set an investment budget within your surplus funds. It is also important to take future income fluctuations into consideration, and to plan a financial plan with a safety margin so that your life will not be ruined in the unlikely event that your earnings do not rise as planned. You may often see advertisements such as "you can start with zero personal funds," but it is risky to easily rely on a full loan. Make sure to balance the amount of loan with the percentage of your own capital, and create a repayment plan that is reasonable.

• Set investment goals: Along with the financial plan, set specific investment goals. For example, "to earn rent income of ³,000,000 in x years" or "to build assets of ³,000,000 to pay for your children's school fees in the future," etc. Be as specific and realistic as possible. When goals are clear, it is easier to select properties and make sound investment decisions. In addition, draw a rough roadmap for achieving your goals (e.g., purchase one unit within x years, purchase a second unit in x years, etc.). Setting goals from a long-term perspective will ensure consistency in your day-to-day decision-making.

• Credit Check and Loan Preparation: Real estate investment is generally financed by loans from financial institutions. Since it is difficult for investors to raise funds several times larger than the purchase price on their own, they use their own funds plus a loan to leverage their investment. Therefore, it is important to confirm in advance whether you have sufficient credit to obtain a loan from a financial institution. Specifically, it is a good idea to apply for a preliminary screening (provisional screening) at a financial institution. The institution will give you a rough estimate of the amount of credit available based on your annual income, asset background, length of employment, other borrowing conditions, and other factors. This will give you a sense of your budget and allow you to purchase a property for up to approximately ¥100,000,000. If you understand the loan limit in advance, you will be able to narrow down your search to realistic candidates when it comes time to look for a property. Also, if you pass the preliminary screening, you can demonstrate your creditworthiness in terms of financing to the seller at the time of the purchase offer, which will lead to more favorable negotiations. It is also important to simulate the type of loan (fixed or variable interest rate), repayment period, equal principal and interest, equal principal and interest, and other conditions. To prepare for the risk of rising interest rates, it is a good idea to stress test your ability to withstand repayment should interest rates rise in the future.

• Information Gathering and Networking: Finally, be prepared to secure a reliable source of information and a sounding board. Beginners will benefit from the advice of acquaintances and experts who are familiar with real estate investment. Attend seminars hosted by reputable real estate companies, read blogs and books by established investors, and take advantage of other opportunities to get a sense of the latest market conditions and the wisdom of successful investors. It is also a good idea to make early contacts with real estate companies that you will ask to introduce properties to you in the future (e.g., by attending company information sessions or making inquiries). This will give you an opportunity to determine the stance of the company, and if you make a good connection, you may be able to receive information on undisclosed properties, as described below. Real estate investment is also an information war, so it is important to broaden your antennae and be aware of your connections from the start. 3.

3. criteria for selecting properties for investment

Once sufficient preparations have been made, it is time to consider which properties to invest in. It is said that 80% of the success or failure of a real estate investment depends on "which property you choose. Therefore, the criteria for property selection should be carefully considered. Here are some typical points that beginners should pay attention to

• Area (location): It is said that " location is everything in real estate. Select a location that is likely to maintain or increase its asset value over the long term, in terms of whether the area has high rental demand and is expected to have a population influx in the future, and whether the distance from the station and the surrounding environment are favorable. Even if the property price is low and the surface yield appears high, an area with low demand increases the risk of vacancy. As a beginner, it is safe to consider properties inurban areas ornear train stations thathave a proven track record, rather than jumping into properties with flashy yields. It is also a good idea to pay attention to the future development potential of the city (redevelopment plans and planned infrastructure improvements).

• Property type and size: Real estate investment strategies vary greatly depending on the type of property you are investing in. For example, owning several condominiums (one-room condominiums) versus owning an entire apartment or condominium building will require different capital and entail different types of risk. There is also a difference depending on whether the property isnew orused (e.g., new construction requires less effort, but has a lower yield, while used properties require more effort to manage, but have a higher yield). Other options include whether to invest in residential properties (condominiums and apartments) or commercial properties (stores and offices), and whether to invest domestically or overseas. Each has different advantages and risk factors, so you need to choose the one that fits your objectives and acceptable risk. In general, beginners often start with residential properties (condominiums and apartments) in Japan, where it is easier to obtain financing from financial institutions. It is also a good idea to start by gaining experience with residential properties in Japan, where it is easy to gather information, and then expand to commercial properties and overseas properties as you become accustomed to the market.

• Profitability (yield) and income/expense planning: As an investment, profitability analysis is unavoidable. Consider not only the superficial yield (annual rental income divided by property price), but also the real yield that you will actually receive. It is necessary to calculate whether the property is profitable after deducting expenses such as monthly loan repayments, management fees, and property taxes. Thoroughly simulate multiple income and expenditure patterns before purchasing. For example, "If the property is fully occupied, you will have a residual of ³,000,000 per year, and if the vacancy rate is fat%, you will have ³,000,000 per year..." Factor in falling rents and rising interest rates for each pessimistic and optimistic scenario. During the simulation, we also estimate annual property taxes, fire insurance premiums, and repair costs every few years, and check that the property will not go bankrupt in the red even under the worst-case scenario. By making such a detailed income/expense plan and thoroughly considering the balance of risk and return before purchasing, you can greatly reduce the risk of easy mistakes.

• Property quality and safety: Real estate is an expensive real asset, so due diligence (proper investigation) before purchase is also essential. Once you find a property you are interested in, be sure to visit the property to inspect it and survey the surrounding area. By actually seeing the property with your own eyes, you will be able to confirm points that cannot be ascertained from information on the Internet alone. For example, the following items should be checked.

  • Surroundings: Distance from the nearest station, availability of convenient facilities such as commercial facilities, schools, hospitals, etc., security and noise conditions in the area, etc. If possible, walk around the area at different times of the day and night, as the atmosphere may change from day to night depending on the location.

  • Building condition: Check the building's structure (earthquake resistance) and age, as well as the state of management of common areas (how well they are cleaned and the state of deterioration of elevators and corridors). Also check the age of the facilities in the private areas (inside the rooms) and whether or not remodeling is necessary.

  • Legal restrictions: Check the city planning and building code restrictions at the municipal office to see if there are any problems specific to the property. Check to see if the property cannot be reconstructed, or if it is an illegal building. Rights (e.g., existence of mortgages, easements, etc.) should also be confirmed in the Important Information Explanation.

  • Disaster Risk: We check the hazard map for flood and landslide risks and the results of the seismic evaluation (old or new seismic resistance) to assess whether the property is resistant to disasters. For example, lowland areas with a high risk of flooding and buildings with older earthquake resistance standards tend to have higher insurance premiums. This is an important point of view to ensure that you can hold the property for a long time with peace of mind.

If you find a property that looks good, contact a real estate agency for detailed information and professional advice from the person in charge. In many cases, particularly good properties are dealt with behind the scenes before they appear on the market, so it is effective to tell a reliable real estate company or agent about your desired conditions and ask them to introduce you to a private property. There is a limit to the amount of information you can find on your own. While utilizing a network of trusted professionals, narrow down your search to the best one by comparing multiple properties.

How to choose a real estate company and management company

In real estate investment, choosing a reliable partner is a shortcut to success. It is difficult to handle everything perfectly on your own, from property acquisition to management. By working with a good real estate company or management company, you can take advantage of their expertise and information network, and as a result, greatly reduce the risk of failure. Here, we will explain the key points for selecting a real estate company (brokerage firm, investment consulting firm, etc.) to support your real estate purchase and a rental management company to manage your property after purchase.

Key Points for Selecting a Reliable Real Estate Company

It is important to choose a real estate company to whom you entrust the introduction of properties and contracting procedures not only as a party to buy and sell properties, but also as a partner with whom you can have a long-term relationship. Especially if you are thinking about asset building from a long-term perspective, a company that supports you even after the purchase and not just as a short-term brokerage is ideal. The key points to determine whether a real estate company is trustworthy or not are as follows.

• Customer-oriented attitude: Some real estate agents may forcefully recommend sales and purchases, giving priority to their own profits. Truly trustworthy companies, however, are "customer-first" and place more importance on long-term relationships than short-term profits. Especially for investors with a long-term perspective, it is desirable to have a partner who is willing to optimize the entire asset portfolio on an ongoing basis, not just one-time transactions. During the initial meeting or other meetings, confirm such questions as "Will this company kindly listen to me and make proposals that meet my objectives?" and "Will they avoid aggressive sales? A long-term relationship based on trust will ultimately bear great fruit.

• Comprehensive strength of a professional team: It is important to check not only the competence of a single person in charge, but also whether the company as a whole has a highly professional team. For example, a company that has a department that is familiar with legal checks and title investigations of properties, or a network of tax accountants that can provide tax advice, will give you peace of mind. Defects and contract risks that are often overlooked by individuals will be safer if the company has a team of experts on its side to check them thoroughly. In fact, INA has a system in place to protect client assets by having a team of survey specialists thoroughly investigate property rights and defects, and by having specialist staff handle the preparation and checking of contracts. It is reassuring to have a partner that manages risk thoroughly at the contract stage.

• Balance between technology and human resources: Recently, the real estate industry has been experiencing a wave of technology, such as AI-based property matching. While advanced companies utilize vast amounts of data to efficiently make investment proposals, they also provide the attention to detail that only a human being can provide. At INA, for example, AI quickly lists properties that match the desired conditions, and the person in charge makes a tailor-made proposal for the most suitable property, including off-market information, realizing a service that combines "data utilization with the power of humans. While we make full use of the latest technology, you can rest assured that we will work with a company that places the highest value on trust between people. It is also important to be able to build a relationship with the person in charge, with whom you can consult on anything.

• Highlevel of responsiveness and track record: Companies that provide investment brokerage services for high-net-worth individuals require a high level of service, including flexible and attentive handling of individual situations and prompt and confidential procedures. Even for general investors, the speed of response to inquiries, the politeness of explanations, and the ability to deal with problems when they arise are important evaluation points. Past transaction records and word-of-mouth reviews from clients are also helpful. A company that has handled a large number of projects is likely to have accumulated experience and knowledge, and is likely to have learned from not only successful cases but also unsuccessful ones in order to improve its services. It is also a good idea to compare multiple companies until you find a professional you feel you can trust, including the personality of the individual in charge.

• Philosophy and vision: Check to see what kind of management philosophy and vision the company has. Especially if you are looking for support for long-term asset building, a company with a philosophy that emphasizes solid growth rather than short-term speculation is a better fit. For example, a company that has a vision of "sustainable growth" in consideration of SDGs (Sustainable Development Goals) and social responsibility tends to offer long-term, stable-oriented proposals rather than encouraging speculative trading. In fact, INA's management philosophy is to carefully and sustainably provide value to high-net-worth clients, based on its emphasis on human resources, "positioning people as the company's assets. A company with this philosophy, which is in line with your values, will be easier to build a trusting relationship with over the long term.

Key Points in Selecting a Rental Management Company

After purchasing a property and becoming the owner, it is also important to select a rental management company that will handle rental management (tenant recruitment, rent control, building maintenance, etc.) on your behalf. Especially if you are busy with your day job or own multiple properties, outsourcing to a reliable management company can save you a great deal of time and effort. When selecting a management company, check the following points

• Management experience and ability to recruit tenants: Check how many properties the company has managed and how familiar they are with the local rental market. A company that manages a large number of units tends to have accumulated know-how and a wide network of tenant recruiters (both its own and those of other companies). It is also important to know whether the company can find tenants quickly when vacancies occur (advertising ability and ability to cooperate with brokers).

• Clear reporting system: Make sure that the company has a system in place to regularly report to the owner on the status of rent payments and property management. A company that properly shares information, such as monthly income/expense reports, and notifications of problems as they occur, is desirable. If, as soon as the management is entrusted to a company, the current status is not known unless you contact the company, you may feel uneasy. Before signing a contract, ask about the frequency and method of reporting, and choose a company with a high level of transparency.

• Reasonableness of fees and expenses: In most cases, the management fee is usually paid monthly as a percentage of the rent. Check to see if it is not too much higher than the market rate (around 5% for luxury properties and 3-7% for general properties) or too low. If it is too inexpensive, there is a possibility that adequate services will not be provided. In addition, check in advance the initial cost at the time of contract, advertising fees for tenant recruitment, and renewal fees, and select a company that you are satisfied with from a comprehensive viewpoint.

• Emergency response capability and maintenance plan: It is also important that the company has a solid response plan for unexpected problems such as tenant complaints or equipment breakdowns: does the company have a 24-hour emergency contact and response service, and a network of affiliated companies (e.g., equipment repair companies)? In addition, check whether the company offers proposals for maintaining asset value, such as periodic building inspections and long-term repair plans. Some management companies proactively propose and implement plans such as periodic inspections of air conditioners and plumbing, painting of exterior walls every few years, and waterproofing of rooftops. Neglecting such efforts may cause asset values to decline and rents to fall, so choosing a company that maintains and manages your property from a long-term perspective will lead to stable management.

In light of the above, when selecting a real estate or property management company to be your partner, it is important to consider whether the company will be a long-term partner. Please find a professional you can trust, focusing on their track record, the personality of the person in charge, and above all, their willingness to stand by your principles and goals.

5. the actual purchase process (from property selection to contract, financing, registration, and start of management)

Once you are fully prepared and have decided on the property you wish to purchase, it is time to proceed with the specific purchase procedures. The process of purchasing real estate generally involves the following steps. If you understand the flow of the process, you will be able to handle it calmly even if it is your first time.

1. Purchase offer and negotiation of terms: When you find a property you want to buy, you first make an offer (proof of purchase) to the seller (or the seller's broker). Then, negotiate the price and terms of the offer. The real estate broker usually acts as an intermediary to negotiate the price and terms of the contract. If the seller is not an individual but a real estate company or developer, it may be difficult to negotiate the price, but it is advisable to consult a professional to obtain the most favorable terms possible. In the case of popular properties, the early bird gets the worm, so it is important to submit an application promptly once you have made up your mind to purchase the property.

2. ExplanationofImportant Matters and Conclusion of Sales Contract: Once you and the seller have reached an agreement on price and terms, a sales contract is formally concluded after an explanation of important matters based on the Building Lots and Buildings Transaction Business Law. In the Important Matter Explanation, the real estate transaction specialist will explain in detail the legal matters concerning the property, rights and conditions of facilities, existence of defects, and matters concerning the cancellation of the contract. Although there are many technical terms and difficult to understand, it is important to check them one by one to prevent problems later on. In particular, it is important to ask questions on the spot to clarify important points such as property rights (existence of mortgages, easements, etc.), matters to be notified (history of accidents and defects in the past), and warranty details for buildings and facilities, if anything is unclear. If the real estate company is trustworthy, their professional staff will check the documents and ensure safety even at this contract stage. When both parties sign and seal the contract, a sales agreement is concluded. At that time, a portion of the property price (e.g., 5-10%) is usually paid by the buyer to the seller as a deposit.

3. Settlement (payment of the balance), delivery of the property, and registration: After the purchase agreement is concluded, a formal loan contract (loan agreement after approval of this review) is concluded with the financial institution, and preparations are made for the date of delivery of the property (settlement date). On the settlement date, the buyer, seller, broker, judicial scrivener, and financial institution representatives gather to complete the prescribed procedures. The buyer pays the seller the remaining balance (the property price minus the deposit, etc.) and receives the keys to the property and related documents from the seller. At the same time, a judicial scrivener applies for registration of transfer of ownership and, if necessary, registration of establishment of a mortgage. Once registration is completed, the title to the property is officially transferred to the buyer. The property now belongs to you, and any profit generated thereafter will also belong to you. Real estate transactions are large and legally complex, so do not let up until the very end and proceed with the procedures one by one, checking each step as you go.

4. Start of rental management: After the property is delivered, you will immediately move into the rental management phase. If the property is vacant, start looking for tenants as soon as possible. If you outsource the property management to a property management company, the company will take care of tenant recruitment advertising and viewing of the property, based on the rental management agreement you have signed in advance. Once a tenant is found, a lease agreement is signed, the keys are handed over, and monthly rent payments and building management operations begin. Beginners generally outsource the management work to a professional company. Although there is a management consignment fee, the company will take care of complicated tasks such as tenant relations, 24-hour emergency response, rent arrears reminders, and settlements when tenants move out, saving you a great deal of time and effort. As the number of properties increases, so does the time and effort required to manage them, so it is essential to have a reliable management company as a partner and to have a system in place. Neglecting management can lead to a decline in tenant satisfaction, resulting in an increase in vacancies, and a deterioration of reputation due to complaints that are left unresolved, which can ultimately lead to a decline in profits and a drop in property values. To prevent this from happening, decide in advance on a regular contact and reporting system, as well as measures to promptly respond to any problems that may arise, and ensure that you have a complete management system in place.

The above is the basic process from purchase to start of operation. Once you have experienced the entire process, you should be able to grasp the overall picture of real estate investment. Of course, detailed procedures differ depending on the property, and there are some points to note, such as the handling of loan covenants, but the most important thing is to proceed step by step without being hasty. You will probably be very anxious in your first dealings, so please do not leave any unclear points unanswered while receiving support from a reliable real estate company. 6.

6. examples of mistakes beginners tend to make and how to avoid them

Real estate investment is always risky, but if you know the typical failure patterns in advance and take countermeasures, you can prevent major mistakes from occurring. Here are some mistakes beginners tend to make and how to avoid them.

• Neglecting location: As mentioned above, the location of a property is the most important factor in determining the success or failure of an investment. Some beginners often jump to properties in the suburbs or underpopulated areas, thinking that "properties in rural areas are cheaper and offer higher yields. However, in areas where rental demand is low, no matter how high the surface yield is, there is a high risk that vacancies will not be filled and the property will not generate the expected income. As a result, rents may have to be lowered, or at worst, tenants may not be attracted and the property may end up in the red. It is wise to consider first whether the location is in demand, and to stay away from areas where you have no experience and no familiarity with the area. If you are unsure about choosing a property, start with a standard high-demand area such as a central Tokyo area or a city with many universities or companies.

• Be misled by surface yield figures: It is dangerous to choose a property based solely on an attractive "X% yield" figure. Surface yields in advertisements are often simple calculations that do not take expenses into account and do not include costs such as loan repayments, fixed costs, and taxes. What is important is whether or not the real yield, after subtracting these costs, is sufficient to generate a profit. In addition, future rent declines and repair costs are inevitable. Before purchasing a property, it is advisable to simulate income and expenditures under multiple scenarios to confirm that you can withstand even the worst case scenario. In the long run, being cautious enough not to buy a property with a plan that can only be realized under an optimistic scenario will pay off in the long run.

• Not considering an exit strategy: Real estate investment does not end when you buy, but there will come a time when you need to sell the property to lock in a profit or move on to the next step. Some beginners, however, do not have an exit strategy for the future, thinking that "it is OK to just buy and earn rental income. This means that they cannot move flexibly when the market environment changes, and as a result, there is a risk that they will end up holding onto the property at a high price and leaving it to be pickled in salt. Before purchasing a property, consider exit scenarios such as, "Will this property be sold for more than ¥10,000,000 after a certain period of time? If the property is intended for inheritance, it is also necessary to consider "whether the property can be divided smoothly at the time of inheritance" and "how tax-efficient the property is. Focusing on the exit scenario will also serve as a warning against acquiring an overpriced property and make your long-term strategy less likely to waver.

• Thinking that purchasing a property is the goal: It is common for beginners to be "satisfied with the purchase. However, the purchase is only the start, and the real challenge lies in the subsequent management of the property. Success is only achieved when you get your rental business on track and continue to generate stable income over a long period of time. Whether you manage the property yourself or outsource the management, it is essential to maintain an environment where tenants can live comfortably, and if a tenant moves out, you must make every effort to secure the next tenant as soon as possible. If you own multiple properties, it is even more important to establish a management system. By partnering with a reliable management company or enlisting the cooperation of family members and staff, you will be able to establish a system that can always keep a close eye on tenant relations and asset maintenance. It is important to always be aware that "the real work begins after you buy" rather than "after you buy.

• Going forward with insufficient knowledge: The world of real estate investment is complicated and full of technical terms. As mentioned at the beginning, knowledge is fundamental, but unfortunately, there are some malicious agents who take advantage of beginners and force them into contracts that are unreasonable. Lack of knowledge is a beginner's greatest weakness, and "I just signed a contract without understanding it" can be fatal. To avoid this, it is necessary to have the attitude to keep learning and the courage to say "I don't know what I don't know. If you have any uncertainties or concerns, do not hesitate to ask questions to the person in charge or the specialist. Do not proceed with ambiguity. It is your right to read through the details of the contract documents and ask for explanations until you understand them. Also, be careful not to get involved in any suspicious investment stories (e.g., foreign deals that guarantee excessively high yields). Keep in mind that sweet words have a flip side, so be sure to accumulate knowledge and experience.

If you pay attention to the above points, you should be able to avoid major mistakes to a great extent. Make decisions carefully and without haste, and try to diversify and reduce risks as much as possible. It is said that in real estate investment, it is just right to "cross a stone bridge. No one can do it perfectly from the beginning, but just knowing the patterns of failure and being prepared for them will make a big difference in the outcome. 7.

7. perspective for long-term growth

Finally, I would like to touch on a perspective that is important for the long-term success of real estate investment. Real estate investment requires an attitude of growing assets from a long-term perspective, rather than being happy or sad about short-term gains. Aim for continuous growth while keeping the following points in mind.

• Investment in human capital (personal growth): A truly successful investor invests not only in physical assets such as properties, but also in human assets. The "people" here are none other than yourself. Improving your "human capital" in terms of knowledge, skills, and judgment is the investment that will yield the highest returns over the long term. Keep studying continuously and keep up with the latest information on market trends, legal revisions, and changes in the taxation system. For example, in recent years, systemic changes have occurred, such as a review of inheritance tax assessments (such as an increase in the assessment of high-value condominiums starting in 2024). If you are unaware of these developments, you may find yourself in a disadvantageous situation without being able to take the measures you could have originally taken. By keeping your antenna up and learning constantly, you will increase your own value (human capital), which will lead to better investment performance.

• Build trust and network: It is said that "trust between people is at the core of real estate investment. In fact, there are many situations where personal connections and trust can make a big difference, such as when good, private deals are only available to those with whom you trust, or when you have a strong relationship of trust with financial institutions, which can lead to more favorable loan terms. In order to grow over the long term, it is essential to build, maintain, and develop good relationships. Specifically, do not stop at one-off transactions with the real estate company or management company representatives, but deepen your trust in them. Through regular contact and exchange of information, they will be able to make better suggestions for you. Relationships with tenants are also important. Even though the owner and tenants have a business relationship, if you are courteous and sincere in your dealings with them, you will gain their trust and increase the likelihood that they will stay with you for a long time. Fewer tenants moving out will reduce vacancy losses, which in turn will lead to higher revenues. In addition, networking with like-minded fellow investors is also beneficial. You may be able to gain insights that you cannot gain individually through exchanging information or jointly holding study sessions with invited experts. Cultivating and nurturing relationships with people carefully will eventually return as great fruits.

• Continuous improvement and the PDCA cycle: In the course of a long-term real estate investment, there will be times when you will need to modify your strategy in response to changes in the market environment or in your stage of life. For example, it is important to be flexible enough to take appropriate measures in response to the situation, such as reconsidering the timing of a sale at a turning point in the economic cycle, or considering early repayment or refinancing depending on interest rate trends. Always monitor the income and expenditures of your portfolio, and if there is a discrepancy between the plan and actual results, analyze the cause and take remedial measures. For example, if vacancies persist longer than expected, review rent settings and advertising methods; if repair costs have increased, putting pressure on profits, strengthen preventive maintenance. If you make it a habit to conduct regular income/expense reviews and strategy reviews, you can take care of small problems before they become major ones and maintain a high rate of asset growth over the long term.

• Focus on social value: INA's philosophy includes the key phrase "sustainable growth for the well-being of all involved. In real estate investment as well, being aware of the win-win situation not only for yourself but also for all stakeholders will ultimately lead to long-term success. Specifically, this means taking into consideration the local community and environment. Investors who participate in beautification activities in the community where their properties are located, renovate older properties to increase their local value, install energy-saving equipment to reduce their environmental impact, and take other socially meaningful actions are more likely to earn the trust of those around them. With growing interest in ESG (Environmental, Social, and Governance) investment, sustainability is a theme that cannot be ignored in the real estate sector. In order to protect and increase assets from a long-term perspective, a broad perspective that also pays attention to social sustainability will be required.

Conclusion

The world of real estate investment is a deep one, and beginners may feel uneasy at first. However, as described in this book, if you learn with a sense of purpose and work with a reliable partner step by step, you can avoid failure and accumulate steady results. Fortunately, investors who value a long-term perspective and philosophy will be able to make calm decisions without making quick profits. Please approach real estate investment with the intention of growing your assets slowly and carefully.

Finally, I would like to emphasize that "people" and "time" are your greatest allies. INA's philosophy of "human capital focus" and "integrity and empathy" will surely guide you in your real estate investment as well.
By taking a long-term perspective and pursuing sustainable growth, you will eventually reap the rich fruits of your investment. We hope that your real estate investment venture will flourish on a solid foundation of trust.