April 21, 2024


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5 essential tips for an effective real estate investment

5 Important Tips for Making A Profitable Real Estate Investment

There is no recipe for the perfect investment, but there are several factors that go into achieving a smarter and better thought acquisition that results in an attractive return on investment. Read more informations from DDP Property.

Investing in real estate is one of the safest and most profitable options that exist, since, unlike other types of businesses, the asset in question is unlikely to be devalued. On the contrary, the capital gain in real estate is the main ally of those who seek to generate profits when buying a real estate.

Some tips for making a good investment in real estate and asserting it are:

1. Analyze the property well

Buying real estate involves paying attention to certain factors that will directly affect the quality of the investment. Going from the particular to the general, the first thing will be to analyze the property itself, it does not matter if it is a land, house or apartment (new or used), you have to verify its conditions ; age, surface area, room layout, orientation, lighting, quality of materials, finishes, architectural design, in short, all physical delivery conditions.

2. Investigate the area and the market

Looking for indicators of the market situation is used to calculate the profitability of a real estate investment , some of these factors are: price, participation of foreign buyers, increases in the price of rents in recent years, demand for properties, currency in which they are made transactions, etc.

This research will contribute to assessing the potential of the investment, an aspect that should not be overlooked is to investigate the nature of the growth in the area (if there is any), that is, to know if it is residential, industrial, commercial or of various kinds. For example, if it is a residential area with high rents and new construction, the safest thing is that you can still grow and invest in housing or commercial lots.

3. Choose the location well 

If the area has already been decided, the following will be to choose the location in detail very well, it is not the same to decide in which city to invest to decide the neighborhood or even the street. It is advisable to assess the benefits in the medium and / or long term , to know if that property may be more profitable than it currently is or if, on the contrary, there is a situation that threatens its capital gain (nearby garbage dump, congested and noisy roads , etc.).

Of course, choosing the precise location will also depend on the purpose of the purchase, for example, if the intention is to invest to rent , you have to look for a site that offers good connections with other places of interest or attractions, especially when it comes to places tourist

4. Buy in pre-sale

Pre-sale projects usually offer much cheaper prices while the property is still under construction, which ensures even more profitability in the medium or long term, since the amount saved by buying in advance contributes to increasing the return on investment directly.

However, before buying in pre-sale to invest in real estate, it is necessary to make sure that the developer of the property in question really has the finances to finish the project and is a well-established company with experience to support it, so it is advisable It is also to inquire about the legality of the construction of real estate development and its commercial use.

5. Think long term

In this blog we have said several times the good profitability that buying real estate can have, but be careful, this does not mean that the return comes immediately. Normally, the profits arrive in a period of no less than three years, since the value of the property is subject to its capital gain over time and to the development of the real estate market in the region.

This implies a knowledge of the way in which real estate moves in the area of ​​the property, if the usual is to buy to rent, establish commercial lots, resale the property or in what way the profits would be generated. Patience and cunning will be key elements , since the fact that the investment may not be recovered in a year does not mean that there is no way to make a profit from the first months of receiving the property.