Category Archives: Invest Intelligently In Real Estate

How to Invest Intelligently In Real Estate

What criteria must now have, those who aspire to invest in real estate? See the three factors that should pay attention to the real estate investors.

There are many people who wonder if the market property is now good investment. The repeated charges, the reduction in purchase prices and rents and removal from the horizon of the next three years -at least- the gains creation are the three factors that trouble today-even-even the most ardent fans of the investment property.

Yet the investment in real estate is still attractive under certain conditions. The truth is that most evaluation of investment in real estate is not as simple as in the past. In fact, today, to be advantageous placement savings in real estate should be taken into account three factors:

  • Time: The time when the property was almost synonymous with profit have elapsed. Plus, buying the property is only advantageous for those who have a time horizon of at least seven years. To put it more simply: If the prospective investor take into account all the costs that will be the acquisition and possession of the property for seven years will realize that by today’s standards as a minimum 5% (concerns akathisias market) and in some cases, can exceed 15%. That this is an expensive investment cost of which cannot be met during a three-year or five years.

Today, capital gains are negative while yields are among the lowest in the EU Thus, the investor is obliged to keep in his possession for longer property to maximize the chances of having a competitive return.

  • Liquidity: In the past, investment in real estate investors employed only in the acquisition cost. Today things have changed since the holding of an immovable asset means increased tax costs (fees, etc. documents).

Condition, so to be successful an investment property is the liquidity required to meet the obligations arising from it. An important factor that should be taken into account is the so-called “liquidity opportunity cost.” That is, the cost will be the investor of installation of liquidity in real estate. For example, what would happen if the euro will be invested in a property’s missing? Or the performance would have been if the euro itself had placed in some other form of investment? So this is not only the honor and patience and future liquidity needs.

  • Confidence: It may sound as a paradox, but unfortunately it is a reality for some investments in real estate , especially land. You want an example? A few years ago if someone bought a plot of four acres knew that there could be build 200 sqm. But today even this can be reversed as well, the head of the Environment Ministry seem determined to change the terms and conditions to perfection in the off-structuring plan .

Also, pending the zoning is an element that can change all of the investment data. The thus investment will be restricted to properties where no changes in land use and planning situation. Naturally, the uncertainties are not limited since there should be relevant tax and social environment.

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