How to invest in real estate
If you have free cash, it will be wise to multiply them. How to do it? Today, the most profitable option is to invest in real estate. Consider why this is so:
The most important advantage of investing in real estate is the almost complete absence of risks (compared to, for example, stocks). Real estate prices are definitely growing over time.
Real estate can be rented out and get a good stable income, or you can sell when its prices have risen strongly and make a profit.
The value of real estate can be increased (improved in various ways, for example, to carry out a major overhaul), and therefore, to get even more profit from it.
Finally, having a lot of real estate, which brings income, you can forget about sitting in the office from 9 to 6 in the evening.
The advantages of real estate as an object for investment are obvious. That is why this type of property is bought as soon as possible by both individuals and legal entities. But how to invest in real estate right? To buy an apartment, house or land? Perhaps worth buying commercial property? Let’s try to understand the pros and cons of various investment options.
Buying an apartment and then renting it out ─ is the most elementary way of investing in real estate available to almost everyone. Housing will be necessary for people always, therefore, tenants will always be there. At the same time, you decide which type of apartment to buy an apartment in, in which area, whether to make repairs there (depending on which apartments are most attractive to tenants in your city). It is no secret that in Russia today one-room apartments are very popular: it is impossible to burn out and go into a minus, renting out such an apartment.
Of course, this investment method has its drawbacks. So, if you do not want to give a decent amount to realtors, you will have to look for tenants yourself, to charge them rent. If the apartments for rent, will be one or two, then all this is permissible. If you have a sum on which you can buy three or more apartments, it is better to invest this money in something else. Otherwise, rental apartments will take too much time, or real estate agents will have to pay a lot.
Note! For subsequent rental you can buy an individual residential house, but keep in mind that the demand for them is much lower than for apartments.
We buy commercial real estate
Commercial real estate ─ these are office, retail, industrial, warehouse and other similar premises. The undoubted advantage of investment in commercial real estate is a higher income than from residential real estate. The most profitable is to rent out retail space: a high, and most importantly, stable income is almost guaranteed. However, it is worth much more than living. The disadvantage of such investments will be the fact that it is more difficult to find a tenant for commercial real estate.
In addition, you will need more or less effective management of this type of property: current and capital repairs; reconciliation of water, heat and electricity meters; payment of taxes. A person who understands little in these matters is unlikely to cope effectively with such tasks. So, you may have to hire professionals, which will entail significant costs.
How to invest in real estate, if the required amount is not on hand? The answer is simple: to invest part of own funds, and part ─ banking. In other words, we are talking about the mortgage. The pledge will be the acquired property.
This option, however, has certain risks. Therefore, it is suitable only for those who are sure that they will be able to pay the mortgage loan, without restricting themselves too severely. Otherwise, there is a possibility of “running into” bank fines. Of course, you need to examine all the offers of banks in the city and choose the most suitable one.
Note! If there is not much money, then real estate under construction is your investment object.
In such a situation it will be beneficial to invest in real estate under construction. It is well known that its prices are much (sometimes 30%) lower than those already commissioned. Consequently, you can buy cheaper and sell more expensive. However, in this case, the risks are growing: no one is insured, he is an unfair developer. Construction may cease altogether due to the bankruptcy of the developer or for other reasons, it may be delayed for several years. It remains only to analyze in detail the reliability of developers and their partners.