CONSECTETUR ADIPISCING ELIT

CONSECTETUR ADIPISCING ELIT

INVESTING IN REAL ESTATE

When is a real estate investment profitable?
In general, conventional real estate investments can generate a return of 5%, 8% or even 10%. This is certainly an improvement over investing in, for example, a term deposit. The expected annual return for this type of investment instrument is usually in the order of 3%.

It is a good time to invest in a property for rent, as real estate is one of the sectors that is offering the highest returns in the current scenario of low interest rates. For all these reasons, the General Council of Associations of Real Estate Agents offers recommendations for successful investment:

- Firstly, investment in residential housing; on the one hand in the conventional model, but above all in the tourist rental model.It is usually more profitable than investment in commercial premises or offices, although this second option is more attractive in large population centres.

- Choose a good area with revaluation prospects, as this is the fundamental factor in making a successful investment. The location of the property is the key factor, as it should ideally be in a dynamic, modern area equipped with all services (green areas, shops, public transport, educational centres, etc.).

- It is essential to carefully study the rental or sales expectations in the area, depending on whether the investment is for the long or short term, respectively.

- In the case of opting for an old property, it is necessary that the purchase price is sufficiently low and the refurbishment affordable, so that it is possible to obtain the desired profitability.

- Areas close to university centres and expanding city neighbourhoods have a high guarantee of success when it comes to acquiring a property for rent.

- It is very important to take into account aspects such as the number of bedrooms, the availability of a lift and garage, the age of the property, its general condition, the orientation or the sunlight it receives and whether the area is quiet or noisy. A property in good condition, perfectly equipped and with good lighting is much more likely to be rented or sold.

- Buyers are facing one of the best times in recent history to obtain a mortgage loan with advantageous conditions due to the low interest rates and the mortgage war that has been unleashed. It is necessary to consult as many entities as possible and negotiate in order to obtain the best credit offered by the market.

- It is important to avoid investing in communities of buildings or individual dwellings located in urbanisations where the community expenses are very high, are distributed among few neighbours, or have luxury services, as this represents a significant reduction in profitability.

- To ensure the success of the investment, especially for investors who are not experts in the sector, it is advisable to seek the advice of a Real Estate Agent. This professional is an expert in the area in which you want to invest, will help you to avoid unnecessary risks and will allow you to complete the whole real estate operation smoothly and within the desired timeframe.

- Thoughtful, unhurried investment. All factors must be carefully studied before buying. We ask the investor not to be emotional, but rational. You have to study every aspect that may affect future profitability, such as price, comparison with other neighbourhoods or whether the type of property is suitable for the rental demand in the area".