The 5 Types of Real Estate Investments

If you plan to buy a property there are multiple alternatives. However, they may not all be ideal for you. That is why you must take into account factors such as your budget, expectations and immediate needs. But before that you have to understand which real estate investment will be beneficial for you. And understanding that here we have compiled 5 Types of Real Estate Investments which you make.

Residential Properties:

It is the most classic way to invest in the real estate market; Buy places to live, whether houses or apartments.

One of the advantages of this type of investment is that the demand – in a stable economic situation at the national level – will increase, as the population continues to grow.

In addition, residential properties are usually more protected against exchange rate risks of local currencies and the value of the property will grow over the years.

Now, the choice between home or apartment will depend on what each buyer looks for according to their needs and expectations.  For example, it is different if you want to occupy it to live for a period with your family if you only intend to rent to foreigners.

Commercial Properties:

The acquisition of commercial premises and offices is one of the most dynamic segments, so it can give good profits in the short term. Generates greater cash flow production compared to other real estate investments.

Also, you have the possibility of having more leases with certain types of commercial property.

Commercial property investors, in addition to having the necessary resources, must also have the appropriate strategies, for example, good networking, timely advice and an economic expectation.

Industrial Properties:

This point includes all those spaces that are used for commercial purposes. One of the positive things about this investment is that it can be used for various uses, either as a warehouse, as an office, to produce goods or services. You can also segment and lease the subspaces that are generated.

Retail properties:

In Chile, the construction of shopping centers does not slow down. Currently, only in the Metropolitan Region there are at least 5 large-scale projects. There are more and more stores and brands, which generates greater demand for these spaces.

In this real estate alternative, we must consider variables such as distribution or location. The latter can influence the success of the premises, since many times the level of sales depends on the number of people passing through that sector.

Real estate investment funds:

Real Estate Investment Funds or Real Estate Investment Trust (REIT) in English, are those investment companies that have real estate assets and that obtain income mainly from the leases of the same. That is, they offer shares on the Stock Exchange, like other companies that are listed on the stock market.

In this case, investors contribute the necessary amount to buy, develop and manage real estate. Its profits are distributed as dividends.

One of the advantages of this modality is that the investor can quickly sell the shares (or quotas) if he needs liquidity and the investment in real estate funds allows investing in commercial as well as residential properties.

To invest you have to do a deep study that includes factors such as the size of the fund, a low level of debt, the quantity and quality of investors, etc or you can also hire an experienced person like Kris Thorkelson who can guide you with this. Vice President of My Place Realty Tom Haughton works closely with Thorkelson and provides coaching and self-improvement seminars for the My Place Realty team.