Tips for Real Estate Investments

Investment in real estate has always been the investment channel preferred by many Israelis. In view of this, it is possible to characterize this as a stable investment channel that is not as highly volatile as its counterparts in the capital market. That said, there are a number of tips which, if applied and implemented by the investor, can help maximize yields as well as help you to avoid buying a cat in a bag.

Market Survey

Although nowadays it is customary to look at the existing supply mainly using digital means when investors are looking to purchase real estate, there is no substitute for leg work where you are looking to purchase the property itself.

Therefore, before you commit yourself to a poor investment and instead of relying on lip service from virtual sites – we highly recommended that you tour the area where you plan to purchase the real estate.

This is because of the great exposure to the climate and the nature of the property you want to buy, as well as the possibility that you will encounter a property that you did not even know existed for sale, and the likelihood that you will have a right of first refusal will also increase.

Choose who to invest with

There are many options for a real estate investor, from an independent investment that involves buying a property on your own, from entering into a partnership with an acquaintance or good friend, to handing over your hard earned money to a real estate company that will handle all of the deal on its own.

The advantages and disadvantages are quite clear. The less you are required to do, the more you have to pay, and if using an external company you can benefit from the knowledge and experience of experts.

However, it is important to understand that any such partnership is derived from the nature and circumstances of the investor’s personal life, and therefore requires an individual examination as well as an individual selection of your investment partners (if any).

If you invest through a real estate company - make sure that the funds are in a trust account.

In addition, if you decide to invest in an outside entity, make sure that your money is invested in a trust account and not in the company itself.  This is the way to guarantee that there will be a separation between your money, as buyer, and the seller – and thus, the seller will not be able to make any personal use of the money for his needs. 

Background check for the property 

Moreover, it sometimes happens that buyers who have made a real estate investment find – after having already closed the deal- that the property they purchased has a demolition order, there are debts or sanctions against it, or that its living environment involves massive renovations or turning the whole area into a construction site.

Although you may still want to make the deal despite all this, prior notice of such issues can and should reduce the price of the property or at least to some extent affect your desire to make the purchase. The alternative of not checking anything is much worse.

Choose a developer who invests in the deal out of pocket

A good way to understand exactly how much the developer who markets and sells you the investment really believes in it, is whether he is willing to make use of his personal funds in order to invest in it. If the developer has decided to invest in it, this can provide you with a somewhat calming factor because this indicates that you and the developer have a common interest, and that the developer highly desires that the investment succeed.

In conclusion - real estate is a profitable and common means to grow your money, but it comes with plenty of fine print.

As you can see from the above, real estate investments can greatly help anyone wishing to do so, to increase their capital regularly way, and it is aided by the 8th wonder of the world – compound interest. On the other hand, it is very important to carefully and individually examine all of the attainments and details that come along with such an investment. The reason for this is the multiplicity of projects, a considerable part of which may contain fine print about the investment that may greatly change your mind about going ahead with it.

Therefore, before you rush to partake in an investment that may be irrelevant to you and which may be more of a loss than a win, we highly recommended that you make all of the required assessments to ensure that the whole process is carried out in the best possible way.

Do you have more questions? Contact us and we will be happy to help

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