One big advantage of a property as an investment is that these are not subject to the loss of purchasing power by inflation effect. These apartments are a stable and secure form of investment and residential properties have been proven over and over again. They have survived crises and times of inflation. In addition they offer themselves as an ideal investment for retirement. In international Compares the property prices are quite moderate, even if you hear about record amounts per square meter in the cities.
Apart from the quality and the price, location plays an extremely important role. It is the basic condition for a steady performance. In metropolitan areas and their catchment area rents will likely continue to rise further. In addition to the geographic location, access to public transport, green spaces, nurseries and shops are decisive criticisms. So you should make sure that the property or the property is in a stable value and attractive location. Infrastructure can be positive or negative. Offering easy access to public transportation is important on busy roads is strong noise but not rare. Falling construction sites in the category of noise pollution. If there are remaining building sites in the immediate area, more construction projects are to be expected.
Homeowners, who use their property as an investment, can repay the loan by the monthly rental income. As soon as the apartment has amortized, is the monthly rent is an additional income for the owner. Anyone who occupies the property has to worry about rent increases instead.
In addition to the location, of course, other factors play a role. When buying an existing property you should take a close look at the facilities next to the price of course. Moisture, a fireplace or the isolation are only several examples, to which one should look for in a Home Inspection.
The average rate on mortgage loans was in the last 50 years at 6.2 percent. Everything under that mark is considered auspicious. If the interest rates are so low, you should take the opportunity and the repayment rate as high as possible agree.
A sizable funding comes, depending on the family situation, the “living Register” together. Are fiscally interesting here let properties. Interest, maintenance and preservation costs may be tax deductible against rental income here.
As an interesting business location and as a preferred country for residence and center of life, the demand for real estate was also worn by the user demand.
For sustainability of real estate investments also ensure the healthy economy and stable currency.
The main factors that affect the success or failure of a real estate portfolio are:
State of the market cycle and expectations (property clock)
Open spectrum / unwanted use types
Utilization of special circumstances
Objects of low quality, which require good management
Rental apartments to condominiums apartments
Office in house use
Hotel in other usage
City or agglomeration?
Investment volume per object
Equity / debt financing rates:
High (leverage driven)?
Long- and short-term financing
Amortization degree and volumes
Interest rate and currency hedges
Several banks / lenders
Tenant target audience / tenant Quality
Rent Schedule / SET and ACTUAL comparisons
Self-care or outsourcing (Facility Management)
Self-administration or outsourcing (property management company)
Limited (how long?) Or unlimited?
Property taxes / possession time
Real Estate Due Diligence
Buyers Due Diligence (investor due diligence) is typically used:
as a basis for real estate transaction
the systematic inspection prior to purchase real estate
determining the purchase price
the identification of opportunities and risks
the positioning of the purchase contract system requirements
Practice usual requires due diligence (see real estate acquisition, warranty)
Risks of a contaminated site or from contaminated sites shall be borne by the seller.
assessing whether contract negotiations from the strong or weak position out can be performed.
Test facilities are:
Real Estate Market (Market Due Diligence)
Legal (Legal Due Diligence)
Taxes (tax due diligence)
(Construction) engineering (technical due diligence)
Contaminated Sites (Environmental Due Diligence)
Finance (financial due diligence)
The operations of a real estate due diligence can be captured as follows schematically:
Overview: Real Estate Due Diligence
Click the graphic to display them in full size.