An investor who wants to invest his money in order to earn a return alongside an investment that is considered relatively stable? Investments in real estate are an optimal investment. It should be noted that there is a risk in this area as well, so it is advisable to make such an investment in as calculated a way as possible and after examining all the variables that may affect the transaction.
How, then, can you make the right real estate investment? We have prepared 6 winning tips for you:
Indirect investment – If you do not want to be preoccupied with managing the property, but only invest a sum and wait for a fixed income, there are two things you should do: invest in commercial real estate and join a fund that is responsible for managing the property. Why? Well, commercial real estate (e.g. Offices and industrial buildings) in many cases turns out to be a more profitable investment, while joining a fund will help that investor to be more relaxed. It is true that this involves paying a management fee, but at the same time such an investment helps to spread the risk and know that everything is run in an ideal way.
- Check the transportation infrastructure near the property – Are you planning to invest in real estate related to residential and / or commercial / employment? Examine the existing transportation system in the vicinity of the property: train and bus stations, their frequency, traffic jams, local loads, proximity to main arteries, etc. Why? This directly affects the price of the property, its potential for improvement and the demand for tenants.
- Compounds with potential for added value and mixed-use complexes – these are complexes that, according to all forecasts, are going to be in great demand in the near future. If because a shopping complex is planned to be built nearby, the area is about to change its designation or is in the vicinity of a light rail station that will be built. What about “mixing uses”? Well this is a trend that is gaining momentum. Today there is a growing understanding that there is no need to separate residential areas from commercial and employment areas, meaning that offices can be close to residential buildings and next to shopping centers, which significantly increases the value of properties in these areas.
- Examining Niches – When you say “real estate investment”, the thought of an apartment or office building is associative. However, it is worth recognizing that the real estate field offers quite a few additional investment options such as land on which planning procedures and student housing are promoted. Before choosing an investment as follows one should ask the right questions and carefully examine the feasibility of the investment, the location of the investment, the significance of the location and the current demand. Of course if it is land it is important to examine what stage of release it is in and what is the regional trend in the subject.
- Research and follow-up of the transaction – Even if the real estate transaction looks amazing, it is important to make sure that by asking the right questions and consulting professionals that it is indeed such.
- Counter-examination – it is important to understand that in all real estate investments there are three parties. The investor side, the property in question and the seller. Before making a real estate investment, we recommend conducting a comprehensive examination: Does the seller actually own the property legally? What is the status of the property in the local authority? ect. Finally, we should note that a real estate transaction may be promising, but first we must be careful when it comes to completing the full tests regarding the property and investment. Good luck!