Tips for productive real estate investments
Before investing in a new home there are many factors to take into account to avoid sinking in the attempt. Knowing firsthand some tips for making your real estate investment will make you feel like a fish in water in this market:
1. Research and choose the right location: Location is one of the most relevant factors for making a good real estate investment. Choosing an area with medium and long-term revaluation plans that has the necessary services for the day to day increases the chances of selling and renting the home later.
Likewise, it is important to invest near our city in order to manage all the necessary procedures in person. In this sense, expanding neighborhoods and university areas become a safe asset when it comes to buying a property to use for rent. The coastal areas, for their part, become the perfect option to get a second home.
2. Study the type of real estate investment: If you want to make profit in real estate investment then you must pay attention to the demand and supply of the houses. Investing in a residential home is the most productive in small cities and coastal areas. However, the best option in large cities is to bet on commercial properties to obtain a higher value for the lease.
In both cases, you have to be properly informed about the community expenses of the property, since it will diminish the return that you thought to obtain with your real estate investment initially.
3. Check the physical and economic condition of the home: A property in perfect condition, fully furnished and with a suitable orientation that provides light to the space, greatly expands the possibilities. However, when acquiring a second home as an investment, other relevant factors must be taken into account such as the age of the home, the useful meters and the distribution of the rooms, since carrying out a reform can reduce the expected profits with the purchase.
In addition to checking the physical condition of the property, you should also go to the Property Registry to verify that it lacks financial burdens and is not in any litigious situation.
4. Look for profitability and long-term appreciation: Do you want to obtain short-term returns after making a real estate investment? Without a doubt you have the wrong business. Normally it is not until five years after the purchase of the property when it begins to revalue and an increase in its value can be observed.
However, it is currently the best time to obtain profitability through mortgage loans thanks to low interest rates and the especially favorable accessibility conditions proposed by banks.
5. Diversify the real estate portfolio: Profitability is inversely proportional to the risk you want to assume. To minimize the risks of our investments, we must have a portfolio of properties that is sufficiently diverse to avoid a plummet in our finances.
Thus, a diversified portfolio must include both homes that have a high probability of appreciation and properties that present a high rental profitability. In this way you guarantee a broad amortization of the real estate investments made.
6. Analyze market trends: Examining the trends in the real estate market and the aspects that may influence the profitability of your investment are essential. Seeking help from a real estate agent will help you to know the average price of homes in the area compared to other neighborhoods, the type of buyers or applicants for rent or sale interested in that district and the conditions of the sector.
Knowing the market trends also becomes essential to know the perfect moment to carry out the sale of the property and achieve the maximum return on the investment.
7. Acquire properties to rent: Rent is on the rise. Insufficient income and the need for greater freedom of movement on the part of the younger section of the population make renting their best option.
In short, there are numerous tips for making a real estate investment, although knowing the sector and having the advice of specialists is key to not dying in the attempt. At Abbotsford Houses we have great experience that guarantee us as a leading company in the sale of real estate. Our professionals will help you know all the aspects to take into account to make the best possible investment. Call us and we will clear all your doubts!