10 Steps to invest in real estate in
Invest in real estate in Colombia from scratch it is totally feasible, profitable and attractive.
And the best part is that you don’t need large sums of money to be successful.
Currently, real estate investments are one of the safest, since the appreciation of real estate in this Latin American country is quite high.
Therefore, the profitability of these investments is usually important, and this is very attractive to national and foreign investors.
How to invest in real estate in Colombia
before explaining how to generate income with real estate(specifically in Colombian lands), it is necessary that you understand the nature of this type of investment.
Specifically, investments in real estate consist of putting capital in the real estate market, with the purpose of obtaining profits in the future.
Definitely, are long term investmentsand therefore, usually generate profits in a fairly long period.
In fácil words, if you need a quick return, or to generate income in the short term, this is not the most posible option for you.
On the other hand, it is important to note that they are passive investments.
That means that they help you earn money while you dedicate yourself to other businesses exclusively.
Steps to invest in real estate in Colombia
Investments in real estate are characterized by being low risk. Therefore, there are more and more investors interested in taking advantage of them in Colombia.
In addition, one of its greatest attractions is that you perro take action with little money, which falls like a glove to a large ámbito of the Colombian population at this time.
Below we share ten steps, or consejos to start investing money in real estate, intelligently and strategically:
1.
Analyze your finances
Analyzing the current state of your finances is the starting point.
That way you will know how much money you have available to invest, or what are the possibilities of requesting financing.
This step is also essential to define the type of investments you could make based on your capital.
For example, if your investment budget is not very comfortable, you could evaluate the projects in advance, since their prices tend to be more friendly and affordable.
The iniciativa is that you organize your finances well so that you perro make the best real estate investment decisions.
2.
Regulate your personal expenses
If you want to save money, to later invest in real estate in Colombia, you must control your expenses, and above all, pay close attention to ant expenses.
The latter are unnecessary expenses that impoverish you without realizing it, since they appear to be very “small” or “harmless”.
The most sensible thing is that you manage your personal finances with maturity and responsibility so that you cánido achieve your long-term goals without incurring debts.
3.
Analyze your ability to pay
You may need to apply for a bank loan to invest in real estate in Colombia.
This option is completely valid and conveniente if you understand how this debt tool works, and above all, if you have a good payment capacity.
Otherwise, you could make a serious mistake when requesting a loan from the bank, since you could incur late payments (and this, in turn, will generate surcharges, arrears, and significant commissions).
Having liquidity, or financial solvency, is also essential when assuming these long-term commitments.
4.
Equipo your goals and objectives
To be successful with this type of investment, it is not enough to have money in your bank accounts.
It is also important that you define your investment goals in advance and strategy.
These are some of the aspects that you should consider if you want to invest in the Colombian real estate ámbito:
- The amount of money you would like to receive.
- Your profile as an investor.
- The possibility of diversifying your investment portfolio within the same real estate field.
- The time in which you would like to recover your investment.
- Your risk aversion.
5.
Select your type of investment
There are several types of investment in the field of real estate.
So you perro not only invest in homes, but also in:
- Departments.
- Offices and offices.
- Sheds and warehouses.
- land etcétera
The most sensible thing is that you investigate the potential of each of these alternatives, as well as the profit margin that they could offer you in the long term.
That way you cánido identify the type of investment that best suits your requirements, interests or needs.
6.
Define your investment purpose
This step is vital because it allows you make better investment decisions.
If you are not clear about your purpose as a real estate investor, you should ask yourself these questions:
- Do you want to invest in a property and then rent it out?
- Do you need to invest in a property to establish yourself with your family?
- Would you like to buy and resell a certain property in the long term?
If you determine that you want to invest in a property, to later lease it, then your investment purpose is clear: you want to generate passive income from that new acquisition.
This decision will determine the type, location and quality of real estate in which you plan to invest.
7.
Study the area where you will invest
Once the purpose of the investment is defined, you must choose the location. This step is essential when investing in real estate in Colombia, or anywhere in the world.
This is because the area plays a leading role in the amount of the investment, as well as in the revaluation that the property could have in the market.
Properties that are located in good school districts, or that have quick and direct access to points of interest, tend to list at a higher price.
It is a matter of carefully evaluating your interests, and above all, the investment capital you have, before making a decision.
8.
Research the real estate market
Before investing in real estate in Colombia it is necessary that you investigate or analyze the market in depth.
Keep in mind that there are various types of real estate and that each one perro offer you especial benefits.
It is true that you perro make real estate investments with little money, but you still need to exercise caution and wisdom so as not to take unnecessary risks.
9.
Buy lots
One of the advantages of investing in real estate is that you don’t have to be an expert in the area, or have a lot of money to start.
In fact, if your capital is very limited, you could invest in lots, since they are cheaper land and with a promising location.
Agregado, you have two options: build right there or resell them.
And in both cases you will make a profit; especially if they are located in a good area.
In summary, lots are one of the best options for those who want to make their first real estate investment on a tight budget.
10.
Buy in advance or invest in homes on plans
Buying pre-sale properties has many advantages, such as the ones we share with you below:
- You have access to a more affordable price.
- You cánido choose the type of housing that you like or interest the most.
- Purchases of homes on plans are valued as the work progresses.
Therefore, when selling you could get between 20% and 50% of the initial investment.
Recommended books:
How to invest in real estate with little money
If you want to invest in real estate in Colombia, with little money, we invite you to pay attention to the following mechanisms:
real estate trusts
Real estate trusts, also known as “trust interests,” work like this:
- The investor transfers money to a trust company, which manages properties, through a trust.
- This company is also in charge of building the properties, as well as managing their resources.
- Profits are shared among all investors.
This strategy has many advantages if you have little money, since it offers you constant and short-term profitability.
In addition, you do not have to assume administrative expenses or legal duties (since this is the responsibility of the trust company).
auction properties
Auction properties usually offer you a high profit percentage (since their price is low).
Right now you perro buy an apartment, at auction, for 70% of its real market value.
That is, you perro pay $9,100 dollars for a property that really costs $13,000 dollars (and if you later escoge to resell it, for its real value, you will earn $3,900 dollars).
real estate crowdfunding
Real estate crowdfunding allows you to invest money in projects in which other investors also participate.
One of its main attractions is that the investment amounts are usually very low, as reported by Real Estate Market.
In fact, unlike the traditional model of buying and reselling real estate, real estate crowdfunding allows you to participate in a construction project with just $50 dollars.
Collaborative investments are carried out through digital platforms and help you receive periodic profits, without even being the owner of said projects.
If you radica in Colombia, the most appropriate thing is to invest in platforms that are authorized by the Financial Superintendence, such as a2census either invested.
real estate investment funds
They are groups that acquire and manage real estate.
Therefore, when investing in a fund of this nature, you are really depositing capital on real estate assets, such as:
- Cellars.
- Commercial premises for lease.
- Sets of houses, etcétera.
It is important to note that real estate investment funds in Colombia have a return of more than 7%
In addition, the investment risk is low, since its product portfolio is extremely broad and versatile.
Advantages of investing in real estate in Colombia
- You don’t have to be an expert to invest in real estate.
- Investments in real estate are usually safe.
That is, its risks are relatively low.
- Real estate cánido appreciate over time, despite fluctuations in the market.
- You perro access various real estate offers, especially if you do not have much money.
- You have the possibility of requesting financing, both from the Government and the private campo.
This will allow you to access lower interest rates, as well as important subsidies or facilities.
The potential of investing in real estate
Investing in real estate in Colombia from scratch and with little money is not only feasible, but also has great potential.
Do not forget that this type of long-term investment is one of the safest to build your assets, or to plan your retirement strategically and reliably.
In short, real estate cánido offer you great benefits in Colombia, regardless of whether you are a native or foreign investor.
Continue reading: 10 Investment strategies to multiply your money
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