Real Estate Investment: What To Know

Property investment is a very popular investment method among investors worldwide. The reason for its popularity depends on many advantages. These are the flexibility in real estate investment, low risk, and gaining income out of the investment.

Certain programs like the Golden Visa schemes have also contributed to the demand for real estate investment. The program comes with residency and possible citizenship rights.

In this real estate investment guide, we provide you with the main concepts about irr vs cash on cash return.

Let’s look at the advantages of making a property investment first.

Benefits

When you get properties in a rather good location, you can enjoy the following benefits:

• You can obtain income out of your residential properties for a long duration. When you especially rent your property, its value increases each year.
• Another benefit is that it’s a tangible investment. So, you have several options to do with your real estate investment. For example, living in or renting it are two of your options. In addition, you’ll not face fluctuations as in the case of the stock market.
• You’re in control, so you can do everything you want with your investment. Selling, renting, or flipping it are some of your options. It’s possible to add parcels as well.

Things To Keep in Mind When You Invest in a Real Estate

Check the following list before you decide on the property you’ll buy.

Evaluate Your Budget and Related Costs

You need to consider the additional fees as well as your budget. Extra fees may include insurance, utilities, and taxes.

Learn About the Property Taxes

When investing in international real estate, make sure you check the property taxes in the related country. Make sure you check all of them. Annual taxes may also come up.

Take a Look at the Surroundings

The neighborhood of the property is as important as the property. This is why it’s advisable to check the surrounding area when you get properties. It’d be useful to know if there are amenities nearby, or if it’s a preferred area by residents. If you move with your children, it’d be better to consider the distance between your house and their school.

Consult a Professional

You’ll get correct information from a professional about the potential costs when you get properties. In this way, you can complete the purchase process in a more smooth way.

Investing in Properties

Several options are available when you buy property. You can read some options below.

Rental Property

Investing in rental property is when you buy real estate and rent it out. It’s also possible to rent out a unit of your property while you still live in it.

Its advantages include:

• Providing a monthly income
• The possibility to sell it anytime
• Regular increase in its value

REIT

REIT is the abbreviation for Real Estate Investment Trusts. The process works like this: Companies own certain commercial real estate and when you use REITs, you invest in such real estate. However, real estate is not the same as the ones you buy in a specific location. Rather, you buy shares and you get dividends. Typically, REITs are traded on stock exchanges.

The advantages of REIT investment include their accessibility. It’s possible to purchase shares of REIT on an investment platform. In addition, you don’t need to take on much responsibility because the company does everything.

House Flipping

Another real estate investment method is house flipping. It includes buying a property that needs renovation. After you renovate it, you sell the property. Its advantages include the generation of high profit. In addition, you’ll get good experience in the real estate industry.

Alternative Real Estate Investment Programs

The Golden Visa programs introduced by certain European countries are alternative ways to apply when you get properties. These programs allow you to buy real estate and get residency and/or citizenship under certain conditions. Portugal, Greece, and Spain offer Golden Visa programs for non-EU nationals.

So, real estate investment can bring advantages that you can enjoy for a long time. Buying international real estate can also result in many benefits like residency rights.