Follow Top 8 Tips for Investing In Real Estate

Making an investment in real estate is not an everyday action, nor is it something that involves making simple decisions. There are many factors that take place when saying: “I am ready to invest in real estate”, and to get to that point you need to be aware that you know what you are doing.

However, it is not about stopping and avoiding starting. Becoming a real estate investor of course that brings many long-term benefits. So, although the bet is not safe, what is certain is that whoever takes the risk is one step closer to success.

So if you are interested in reaching that point, we have many tips that we think it is important to share before you make your first investment. And don’t lose faith in solving your goals! Investing is not a luxury that only large real estate companies can make. From any trench you can start to draw your own action plan to invest in real estate.

Basic tips for dummies

First and long before you take any action; you must learn to manage your finances. The less you owe to your bank, the more opportunity you will have to save money for your personal investments and obviously to buy goods. Sounds like a very logical advice, but there are many people who want to enter the team of “investors” because they believe it is “easy money”, without thinking that no matter how much money you have budgeted for investments, whenever you have debts, they will be an obstacle for you to start with the right foot. Keep accounts clean and up to date.

Make sure that both your taxes and your mortgages and insurance can be paid with your income earnings! Nor are you going to invest in spaces that cannot cover your own expenses, it would be foolish. Look for market offers that mean a profit for you, not just attractive revenue. If you are not getting anything extra, something you are doing wrong. Finally, this additional money is used for future investments or for any repairs that your current real estate needs.

How do you want to invest? Learn your approach

1. For rental income

The most obvious form of investment in real estate is this. The process is relatively simple. You buy a property and rent it to generate income.

2. Arrange for sale

The trick of this investment is to buy a house at an affordable price and arrange it to be able to sell it at a higher price with which you get a profit.

3. Sell at a higher price

Similar to the aforementioned, in this investment you buy a property at a discount and sell it for a higher price. To do this, you have to know in depth the supply and demand of real estate at the local level.

4. Buy and maintain

The latter has to do with selling at a higher price, but the responsibility of maintaining the property for an indeterminate period is accepted until the time for sale is the most optimal.

4. Invest in off plan projects

Buying an off-plan property means investing in a property before it has been constructed. This is considered as a risky move, however in some cases it can also be very rewarding, especially when property prices are rising.

5. Passive and active investments

In real estate, there are two ways in which you can make your investment. The first is actively, this is closely related to the aforementioned forms of investment. All those depend on you individually taking care of your investments. However, you can also passively invest through a third party, that is, a real estate syndication.

6. Transparency before the law

Before making any acquisition, review the deeds of the property. Make sure you know the information of the person who is selling the property. If you belong to a company, check that it is accredited for the function you are doing. Check that everything is in order and under the Public Property Registry, in addition to having a copy of the real folio. Do not forget either that the property must be current in all your payments. Review the specific documentation to corroborate this.

7. External factors to take into consideration

According to Forbes magazine, the landscape for real estate investment in Mexico is going through a good time. The Fibras “Infrastructure and Real Estate Trust” have paid 150% and maintained a return on the Mexican stock exchange of 50%.

On the other hand, you must be attentive to tax reform. According to the magazine Real Estate Market & Lifestyle, our current tax reform is focused on controlling the income from the sale and purchase operations.

8. Seek advice

Do not rule out receiving advice from experts in the field. Talking about real estate investments is not a simple matter, it requires knowledge in many areas. Therefore, we advise you to approach an expert and draw up an action plan based on the recommendations made here, but also what a professional could advise you.