Real estate investments are an excellent refuge in times of economic volatility. And compared to low-risk assets such as debt or term deposits that have lost profitability, they are positioned as an excellent alternative. The investments in the housing sector oscillate between 3% and 5.5% of profitability. Good margin if we think that the risk is low and that, on the other hand, there is the capital gain, so the cost/benefit ratio, then, is positive.
5 key aspects of real estate investments
If you plan to enter the real estate business, keep in mind the following keys to increase the chances of success.
1. Analyze our financial situation and investment time
The first thing that we must define in all types of business and real estate investments in our risk profile, is, how much we are willing to lose.
While it is true that when placing the capital in real estate investments possibilities of loss are minimal, they are always there, and you should consider them.
Mortgage credit is one of the financing tools most used by real estate investors in Chile. In fact, we could indicate, roughly, that real estate investments offer four sources of wealth:
- Cash flow through the payment of rent (income) and expenses associated with the maintenance of the property.
- Capital gain.
- Fiscal benefits.
- Payment of capital or financing of the property with own resources and mortgage credit.
That is to say: the property pays “for itself”, and once we finalize the debt, we can sell the property and keep 100% of the capital gain.
2. Study and assess taxes carefully
Real estate is subject to taxes that we must assume.
However, they also enjoy different tax benefits that maximize profit.
For example, in general, real estate investors in Chile look for DFL2 homes (maximum 140 square meters), since they have access to discounts in the payment of contributions, exemption from inheritance tax, and reduction in the registration fee in the Conservator of Real Estate.
We must take into account the tax framework that the property encloses, to determine the viability of the acquisition.
3. Observe the business
To increase the chances of success in business and real estate investments, it is important to evaluate real estate prices in the area, demand for rentals, projected capital gains, real estate development, and other macroeconomic factors that may affect the dynamics of the real estate market.
4. Seek advice on real estate investments
When entering this business, it is prudent to do so in the hands of a good real estate investment advisory – such as the one offered by Easy Investment. Which allows us to place our money safely in the most profitable assets.
On the other hand, the idea is that they help us appraise properties and clarify doubts. Like legislative, tax, procedures, and expenses associated with the operation.
5. Analyze your investment objectives
It is important to know what and for what we want to invest. The market gives us the option of:
- Buy to lease.
- Buy to live.
- Buy a second home.
- Buy to remodel and sell.
- Buy for business purposes.
- Real estate funds.
According to a study by Colliers International, in recent months the interest in investing in assets with income has increased, as they offer attractive performances.
An Easy Investment will find excellent real estate projects like Discovery Gardens Islamabad, with characteristics that predict sustained growth of wealth over time and personalized advice.
What does a real estate investment advisor do?
Most economic sectors have been affected during the pandemic, and the real estate industry was no exception.
However, we well know, from difficult situations opportunities can also arise.
Real estate investments have had to reinvent themselves to achieve the returns to which they were accustomed, obtaining, over time, a rebound expected by many.
On the one hand, there is an over-stock of properties because real estate companies are increasingly incorporating more projects. The pandemic also did not allow normal sales to be achieved.
In the case of departments, during the fourth quarter of 2020. There was an increase in the stock of 130%, which has led to offering homes at lower prices.
This article will see in-depth what its functions are and how to find the right one.
What is a real estate advisor?
It is a person who provides advice when buying, selling, or investing in properties.
In our case, when we want to buy a home. The advisor accompanies us throughout the process to help us make the best decision.
For this reason, when we speak of “advisor” we refer to a person specialized in the market and with sufficient experience to guide us on the subject of investments.
You may even have legal and financial knowledge regarding the horizontal property.
Manage the property visit
Based on the research carried out. The advisor will provide us with a series of options adapted to our expectations and current reality.
Then, we can evaluate the different homes available and decide which ones interest us.
During this stage, we have to review the information provided, reorder our priorities if necessary, make virtual visits, among other things.
Finally, the advisor can arrange a face-to-face visit to the projects that really interest us.
Agree on the best purchase conditions
Real estate advisers can also act as intermediaries.
Thanks to their trajectory and negotiation skills, they can help us to ensure the best payment conditions depending on the different stages of each project. Allowing us to obtain discounts that we will not get otherwise.
In conclusion, advisers, such as those provided by Regal Marketing, facilitate the way to buy a home, guaranteeing maximum profit.