Investing in property can be quite lucrative—or it can be a recipe for disaster. We’re all familiar with real estate moguls who will never again have to worry about money, but how did they get there? Why did they succeed? You probably won’t become a billionaire by investing in property but you can insure yourself a comfortable lifestyle and retirement by making a few good judgments with a little foresight.

Commercial property is everywhere. Office buildings, medical centers, small shopping malls, retail stores, hotels and other types of property has always been a popular commodity amongst real estate investors. Prior to the recent economic downturn, these properties were busy and steady sources of income. Even with a poor economy, though, commercial property can be profitable if you know how to avoid the pitfalls.

When looking at a commercial property, look at the businesses around it. Are they thriving or are their car parks mostly empty? What types of permits are on file for future construction? You would not want to invest in a shopping center if there is a huge mall scheduled to be completed a block away in a couple of years. What are the property taxes and does the local population have the demographic you need to attract occupants for your commercial property?

When investing in property you also need to look at the neighborhood the property occupies. You may attract a lot of tenants in a low-rent neighborhood but if the crime statistics are high you’ll have a high rate of turnover and your income will be sporadic at best. Look at the amenities available to your tenants, too. The presence of restaurants, office supply stores, available parking and other factors all contribute to your chances of success. Think of yourself as someone who is looking for a commercial lease and what you would want in a building. Then make your decision whether to buy or not.

Residential property can also be an excellent investment if you know what to expect. Many people “buy to let”, meaning they buy a property with the intention of letting it to make the mortgage payment plus a profit.

Look at the age of the property or residence before you consider investing in property; it is a good indication of how much upkeep you will have to invest in. Nearly all property owners are responsible for the maintenance and upkeep of their properties, whether they let them out or not. Heating and/or cooling systems, new roofs and plumbing are quite costly. Buying property in a neighborhood that is becoming “gentrified” can be quite profitable as your property values will go up, allowing you to resell it at a profit in the future.

Investing in property takes thought and planning as well as money. You must look at the future as well as the present when making a decision whether investing in property is the right thing to do for your financial goals.