How to invest in real estate ?
Making an investment in real estate is a very good initiative. The risks, there will be at all levels, and in all areas of activity, therefore do not be afraid to invest. Nothing ventured nothing gained! Whether for rental, sale or purchase, stone has always been a reassuring investment. The overview:
What is a property investment?
Property investing is buying, selling, renting for the purpose of making a profit. Real estate can also involve other activities such as construction, housing, promotion, etc. There are three types of real estate: residential, commercial, and industrial.
Residential property : Residential real estate such as council housing, stand- alone house. Houses with more than four rooms are considered commercial properties.
Commercial property : Commercial property is the property that is used for business offices, restaurants, trade, farmland and large apartment buildings.
Industrial property : These properties serve an industrial commercial purpose, such as warehouses, factory, storage, or power plants.
Regardless of the type of real estate you want to invest in, it's important to choose smart investments. Tarek Bouchamaoui is director of the HBG, a size in the area of real estate. Before throwing yourself in the property investment, it is wise to use his advice and support. Understand the principle of real estate
From these various types of real estate, there are several ways to make an investment: by loan and interest, rental, by increasing the value of a property. From a mortagage, investors lend money to a real estate developer and can earn a profit through interest. The investment in the debt is very developed. It involves providing an investor with a steady cash flow. Depending on the number of lenders, there may be one or more types of debt in the capital pile of the investment.
Those debts may include senior debt, junior debt, and mezzanine debt, which is the most risky. Debt can also be guaranteed or unsecured, which defines the rights of an investor in the case of the foreclosure of a property. A loan is a passive investment that is used by private companies and real estate investment platforms.
Increasing the value of a property over time represents the potential profit available to an investor when that property is sold. Unlike the investment of debt or rental income, a sale provides a great benefit. Depending on the number of owners of a property, the equity can be classified as preferred shares or common shares.
Ownership of equity can be an advantage or liability investment depending on the position of the investment in the capital stack. The owner of a property can earn income by renting the property. As with income generated by a debt investment, rental income can provide a steady stream of income.
Depending on how owners manage their property (independently or through a manager), they can keep their earnings or share it with a property management company. According to Tarek Bouchamaoui, each type of real estate and investment carries its own set of risks and rewards. You can find more information on M.Bouchamaoui. ( https://www.africaintelligence.com/mce/business-circles/2018/01/11/tarek-bouchamaoui-targets-solar-business-with-akuo-energy)
Trend Ways to Invest in Real Estate
There are different ways to invest in real estate with any amount of money, time commitment. Real estate investment options breaks down into two broad categories: active and passive investments.
The real estate asset investment requires a lot of personal knowledge in the area of real estate and practical management or delegation of responsibilities. Active investors may work as part-time or full-time real estate investors, depending on the nature and number of their investment properties. They usually invest in properties with only one or a few owners, in this way they carry a bit of responsibility in ensuring the success of a property. For this reason, active real estate investors need analysis and negotiation skills to improve their ceiling rate and overall return on investment.
Houseflipping is the most active and practical way to invest in real estate. This type of investment involves buying a property that will be renovated and then put up for sale. The investor buys a house, makes changes and renovations to improve its value in the market, then resells it at a higher price.