One of the top investment vehicles that people recommend is real estate. There are no constants when it comes to investment but many experts in the field agree that real estate is still a lot safer and less volatile than others such as stocks and currency. Although it comes with much bigger capital, it is good to invest in real estate and introduce diversity in one’s investment portfolio for those who have the means.
Real estate tends to be easier for investors to handle for beginners because it requires less background knowledge than other investment vehicles. Generally, real estate as an investment is considered stable. Though one of the important things to assess, among other things, is the timing.
Aside from the aforementioned reasons, what makes real estate a good investment? Why do a number of billionaires claim that it is the way to go to build one’s wealth? This article will list some of the top reasons behind this.
If there is a hot topic for professionals and the non-professionals in the world of economics these days, it is inflation. The word is being heard everywhere: mainstream news outlets, social media, print, and many other channels.
Investopedia defines inflation as the rate at which prices for goods and services rise. As the prices shoot up, the purchasing power of currency goes down. This is bad news for everyone who saves up by letting their money sit in the bank because it will lose value over time.
Since the prices of land continuously rise up, investing in real estate can give a hedge against inflation. Real estate is known to increase value and appreciate over time. This is true for most properties, especially the luxury ones that are situated in good locations.
If the luxury property is well-maintained and situated in a good location, its value will only increase over time. Once it is time to sell, investors can expect big returns so it is important to make sure to have the property always ready when the right timing and buyer comes.
There are many luxury real estate developments in the Philippines but there are those that stand out when it comes to its location, world-class architectural design, great amenities and features—one of which is Brittany Corporation with its world-class luxury homes.
Luxury real estate also have its surprising trends. During the pandemic, many people started looking into vacation homes because of the need for a bigger space to accommodate all the activities needed to be done inside the house. By that time, luxury real estate properties received a high demand because it checks all the boxes needed for a good home.
But even without this kind of trends, luxury real estate constantly receive demands because many affluent investors are always on the lookout for properties that they can hold and sell over time as it appreciates. This means that there will always be a demand and cash flow when investing in luxury real estate properties.
The famous buying and selling strategy is not the only way when it comes to real estate. There are other ways that can be done with real estate properties which makes it a versatile investment. Some people take interest in flipping houses while other consider leasing.
These days, homestays or staycations are popular. The most in-demand properties in renting apps are luxury properties since they provide amenities and features that are perfect for such experience. For luxury real estate investors, this can be a source of constant passive income. Without much work, they can rent out the property for short periods of time and receive good returns in the long run.
However, it is important for an investor to make sure that investing in luxury real estate does not become more of a burden than a means for business. There are items to consider such as interest payments, principal repayments, and operating expenses. Luxury real estate investors have to make sure they can hold on to the property for a long time and ride out any volatility in the market.
As previously mentioned, the success of investing in real estate is almost guaranteed if this one thing has been considered: timing. The seasonality in the real estate market is one of the top factors that affect the supply and demand in this industry.
Many newbies in real estate investing might think that seasons can have a huge impact to property’s asking price but even the smallest percentage will cost a lot. Listed below are some of the tips to avoid this scenario.
The word seasonality in this context refer to both the climate and its effect to the specific location, and it varies each time. In the real estate’s global scene, there are some areas in which the summer season brings in a crowd while to some, it moves people away. This will affect the pace of home sales in these areas.
It is important to do the proper research on how these factors affect the supply and demand in the location where the luxury real estate property is situated.
Some of the factors that affect supply and demand real estate properties include the weather, location, and seasonal trends. Examples of seasonal trends are opening and closing of school year and holiday season. These seasonal trends can either positively or negatively affect real estate depending on the location.
How does this work? It can be simply as considering the opening and closing of school year in the city since most parents would not want to do a big move right in the middle of their children’s academic year. It will have more complications when it comes to the processing of their transfer to a new school. Typically, parents would want to start afresh by finishing all commitments in their old place first prior to moving.
Since many schools tend to make summer the students’ vacation time, it can be a busy time for real estate at this time. In this case, it can affect the market positively by adding to the demand from aspiring homeowners.
For investors who are looking into renting the luxury property for homestays, summer is also the busiest time of the year since many people tend to plan their vacation time during this season. If the luxury property has its own amenities like a swimming pool, it will surely be a hit for many guests.
Since summer investing in luxury real estate seems to be a good idea for investors to sell or rent out their properties, it might not be the best time to buy for those who are looking into it. Because of the demand in housing at this time, the prices might be a little higher than usual because of the competition.
The summer season mostly brings good odds to the real estate market. If you are interested to invest in luxury real estate properties, look no further! Brittany Corporation, one of the developers in the Philippines specializing in luxury real estate, has an exceptional portfolio of properties for sale.
Vista Alabang, Brittany’s flagship development located in Daang Hari. It is a 1,500-hectare Italian-inspired community that was master-planned to provide its residents comfort, enjoyment, and wellness—the vision of luxury living.
Find out how to get your own luxury home in Vista Alabang by visiting Brittany’s social media pages.
Suggested Read: The Impact Of Inflation Rate On Real Estate Investors
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Suggested Read: How Can You Make A Living Selling Real Estate
Suggested Read: Summer Vacation Home Buying Tips
Suggested Read: Housing Trends For 2023
