Most experts predict serious changes in the financial sector, speaking of the continuation of the crisis in 2020-2021. Under such conditions, it is time to decide to invest in order not only to save, but also try to increase your capital and its purchasing power.
In the TOP of the most common questions is whether it is worth investing in real estate. On the one hand, there is instability in the country, not only in the economy, but also in politics. On the other hand, choosing a profitable investment object is not always easy and simple. Therefore, let's talk about where it makes sense and how to invest in real estate. By the way, if you decide buy a house in Kyiv, we recommend contacting the best luxury real estate agency THE Capital.
Is it worth investing in real estate
Even with high risks, such an investment is worth considering. Keeping your finances “under the mattress” will not bring a good result, since any currency tends to depreciate, and in addition to inflation, a variety of factors can affect this. How to start investing in real estate? First of all, you need to abandon impulsive actions and analyze the entire investment market, evaluating all the pros and cons of each direction, for example:
- Bank deposit. According to the Ministry of Finance, the income from the dollar deposit is no more than 2%, the hryvnia deposit can bring up to 10%, but there is even a risk of losses due to inflation.
- Cryptocurrency, stocks, startups and other high-risk investment areas. In this case, beginners often rely only on trust and are guided by the promised percentage of profits. Those who ponder whether it is profitable to invest in real estate, and in the end choose risky directions, as a result, more often lose their money. For example, only about 10% of startups are successful and have been in operation for over a year. Investing in stocks requires up-to-date knowledge in the field of economics and finance, and cryptocurrencies have long been showing instability, significantly "jumping" in price.
- Precious metals are one of the risk-free investment options, but the profitability is not high either. In addition, it is worth investing in the same gold only if you have a large budget.
Read more:: What is self-construction and how to legalize it?
To understand how to properly invest in real estate, it is important to study the market. Buying square meters is a worthy and profitable choice. In addition, the situation with housing is much clearer, even if this is the first time you are faced with this issue. To understand how to invest in real estate, you do not need to study the work of banks, study the dynamics of securities or currencies, depending on the financial and political situation in the country. Let's figure it out in more detail.
What real estate is profitable to invest in today: getting to know the options
Before you figure out how to invest in real estate in Ukraine, you need to understand that here the choice is presented in three directions:
Not all housing can be a source of great profit. When thinking about whether it is profitable to invest in real estate, you must first of all assess the period of its operation. The modern secondary housing is very outdated, and technically many objects are no longer subject to exploitation. New buildings are actively capturing the market, but regardless of the choice of the type of object, it is also important to understand why you need to invest money in real estate and how much you will have to invest.
Resale property
In this case, it is profitable to buy an apartment even at the construction stage, it is better at the stage of the foundation pit. Statistics show that in this case a complete object will cost up to 40% less! For example, in the residential complex "Respublika", which is located in the Goloseevsky district, in the first residential complexes at the initial stages of construction, the cost of a meter was about $ 800. By the time of commissioning, the price of a meter rose to $ 1200-1300. That is, it was possible to earn about $ 400-500 on the assignment.
Read more:: Where is it better to buy an apartment: in a new building or on the secondary market?
Now, when the territory of the complex is landscaped, a large part of the houses are inhabited, the prices for apartments in new queues start at $ 1480, while finished apartments are sold for $ 2000.
Why it is profitable to invest in real estate in this case is not difficult to guess - the difference in cost is more than 20% per annum, since the first houses in the residential complex were ready in about 2 years.
Acquisition of real estate for resale is a risky undertaking, since a construction site can turn into a long-term construction, even in an optimistic forecast, the terms of real estate commissioning can drag on for six months or a year. Therefore, before entering into a purchase transaction, you need to make sure that the construction company is in good faith and all permits.
Real estate investment for long term rent
Studios, one-bedroom and two-bedroom apartments are at the peak of popularity, so this is an excellent option for long-term rentals in order to obtain a stable monthly profit. Is it worth investing in real estate in Ukraine? Here are some simple calculations as an example:
- The apartment is 30 sq. meter will cost about $ 30.
- Approximately $ 8000-10 will need to be spent on furnishings - repairs, appliances, furniture.
- After renting out for a month, a small apartment will provide an income of $ 350.
- The annual income will be approximately $ 4000, of which up to 10% will need to be spent on apartment depreciation and taxes.
Thus, the investment will pay off in about 8-9 years.
Daily rent of real estate
Speaking about which real estate it is better to invest in for its subsequent daily rent, it is worth considering small apartments, for example, one-room apartments and studios. Their cost ranges from $ 25- $ 000 + furniture and decoration - about $ 35. The cost of renting real estate per day is $ 000-10. When renting an apartment even half days a year, the monthly cost will be $ 000 or more than $ 25 per year, taking into account utility bills and depreciation. In this case, a small apartment rented out for daily rent will pay off in 30-375 years.
Where to invest in real estate: is there any point in investing in land
Speaking of real estate, it is worth considering investing in land plots and ready-made single-family houses. Land is an asset that can be valued in different ways, so it is important to consider here:
- location of the object;
- his condition;
- features of future operation.
Thinking about whether it is profitable to invest in real estate, first you should pay attention to the location of the site. If it is located in the suburbs of a million-plus city, it is an asset with a positive upward trend in value. However, the prospect concerns primarily land for construction - residential, industrial. As a result, a finished object, including one where something can be produced (grown), in the future can become a good source of income and a quick return on investment.
How to best invest in real estate: several important steps
When experts advise “invest in real estate”, they first of all assume a thorough study of all the pitfalls and the stage-by-stage of the investor's actions.
Researching market trends
Since investing in real estate involves a long payback period, the first step for a budget holder is to identify long-term trends in detail. In other words, you need to find out whether it is worth investing in real estate now and what are the forecasts for the future - at least 15 years. Factors are taken into account:
- property location;
- condition of real estate;
- how you plan to use the object.
For example, on the outskirts of Kiev, in new residential complexes, two-room apartments become more expensive after the commissioning of an object, then one-bedroom apartments, and the cheapest are three rubles and more spacious objects.
Study of tax legislation and the basics of documentary literacy
Understanding why it is profitable to invest in real estate, a person must understand that he will face the implementation of the sale and purchase transaction and the subsequent costs associated with the current legislation.
- State duty on the sale of real estate - 1% of the transaction amount.
- Payment of state duty to the pension fund - 1% of the transaction amount.
Also, the cost budget needs to include the payment of the work of the company that accompanied the transaction, take into account the additional costs associated with the organization of the sale and purchase. If you contact the specialists of our company, they discuss all the nuances in advance and accompany the client at all stages of the transaction. We are also ready to take on the legal aspects of drawing up an agreement with the seller - it is important to competently take into account the interests of all parties and eliminate risks.
We examine the attachment object correctly
What does it mean to invest in real estate? This means being able to correctly assess it!
- For example, a cottage and a land plot should be inspected in winter or in March, since in the warm season such objects have a presentable appearance and all the imperfections of the land, its surroundings and flaws in the access roads are not visible.
- Apartments in the secondary market require not only a thorough and reliable inspection, but also a high-quality legal check to exclude the fact of fraud.
- Primary housing is worth buying during the construction stages, given the convenience of planning and the benefits of location. And after the delivery of the house, the cost of sq. meters will inevitably grow anyway!
How to start investing in real estate if there is no money
And such a moment is often of interest to Ukrainians, since large Ukrainian banks are actively expanding the possibilities of lending for the purchase of housing. In solving this issue, there is only one profitable option - lending or installment plan are advisable only in case of a lack of the minimum amount of the cost of the selected new object. That is, at least 70% of the housing price must be available, then it is possible to arrange an installment plan, including from the developer directly.
So, should you invest in real estate? The answer is obvious - this is one of the most profitable ways to make a profit. However, the choice of the object of purchase should be approached carefully, and in the absence of knowledge and experience, it will be difficult to manage without the help of experts. Subscribe to our updates real estate portal and get the latest publications from the real estate agency THE Capital.
