The 5 keys to real estate management
A good real estate management will call for more tentative investments, currently there are those related to the real estate sector.
However, for the profitability of such investments to be sustained and safe, proper property management must be implemented.
Next, you will know 5 keys to achieve success in this market:
1. Know the different real estate investment funds
One of the options for investors is to opt for investment funds, which are constituted in contributions -managed by a corporation- made by participants with the objective of investing in securities or goods. Good real estate management will have different categories, such as:
For rent: those real estate built or to be built to generate profits for rent.
Development: it is used when you invest in the development and construction of projects, obtaining profits through their sale.
Goodwill: invests in real estate, seeking a future profit from external circumstances, such as improvements in the environment.
Mixed: they allow you to unite several categories. For example, using the medium-term rental real estate investment and using the increase in surplus value to obtain profits on the sale of a property.
2. Financial leverage: how to use it to your advantage?
It is defined as the use of debts to generate assets that, in turn, have the ability to generate more assets. Three types of leverage are recognized: positive, neutral and negative.
For this tool to benefit you and not be dangerous for your finances, it is necessary to have a good real estate management and thus seek investments that through debt maintain positive leverage, that is, generate a cash flow that allows you to pay the debt and keep the investment.
3. Find the right real estate investment advice
It is important that your investment is supported by people with knowledge in real estate asset management, ready to advise on the best alternatives to achieve a good return on investment.
Therefore, you should look for experts in the different phases that the sale of properties compromises so that they can provide you with a continuous accompaniment that generates tranquility in your financial movements.
4. Compare before investing
The capitalization rate or Cap Rate is a tool used for the management of real estate assets, with the aim of comparing between different investment options. Thus, it allows estimating the income that you will obtain monthly or annually when investing in a property in relation to the commercial value of the lease.
This is important because the communes offer different returns.
5. Buy properties in green
This option is about buying a certain property when it is under construction. Among its main advantages are
The capital gain can have the property between the moment you acquire it (in green) and when you already have it to sell or rent it.
You have more time to pay the foot of the property and make the payments at your convenience.
You will be able to choose the best locations for the apartment units.
However, it also has risks that you should consider in real estate management, for example, that in the organization where you invest your money, it presents problems and does not comply with the agreement. For this, it is advisable to check very well between different real estate agencies before deciding.
Finally, it is essential that you do the pertinent analyzes to know how the return on your investments is behaving. Apart from having adequate real estate investment advice, it is important that you know how this market works, as well as the urban projection of the areas where you invest.