There are many benefits for those who invest in real estate, and for this reason these have become some of the most popular assets today. Real estate investments are a great way to earn income and build wealth. Best of all?
Investing in real estate can be done in different ways, some simpler and others more complicated. You just have to find the one that best suits your needs.
Today we tell you everything you need to know about real estate investments.
Shall we start?
What is real estate
Before we dive into what real estate investments are, let's review what real estate is.
A real estate property encompasses all those assets or real estate that can be exploited to generate a return. Normally, the person who acquires this type of property obtains a series of rights to it.
What is real estate investment
Investing in real estate consists of acquiring properties with the objective of generating profitability by means of:
- Leasing models.
- The subsequent resale of the property.
- The swap/exchange of properties.
- Real estate investment funds.
After seeing all this, we can say that Real estate investment is one that acquires a property to generate, with said acquisition, income, offering investors a wide range of financial opportunities, since it makes it possible to generate wealth in a stable manner, even in times of economic crisis.
Thus, the sole objective of real estate investments is not only to make money, but generate passive income from different rental properties or mortgage interest, for example.
What types of real estate investment are there
Investing in real estate not only involves the direct purchase of houses, flats or land in the different markets. There are many types of real estate transactions and investment methods available, which do not require investment capital as high as other investments.
SOCIMIS
SOCIMIS, or Listed Public Limited Real Estate Investment Companies, are the Spanish adaptation of what Anglo-Saxon countries know as real estate investment vehicles (REITs). Its main objective is the purchase, promotion and rehabilitation of real estate assets for lease.
One of the great advantages of publicly traded SOCIMIS is that they offer more liquidity than other real estate investments: If you suddenly need cash, you can sell your shares on the stock exchange. Among the main requirements that a SOCIMI must meet, we see the following:
- Have a minimum capital of five million euros.
- Dividend 80% of rental income and 50% of capital gains realized through the transfer of assets.
- Trade on a regulated stock market.
Real estate crowdfunding
Real estate crowdfunding, also known as collective project investment, consists of invest in the real estate sector jointly with other investors, without the need to make a large investment of money. It brings together different investors to face an adventure that would be impossible alone for each of them.
Investors will be able to diversify their investments and own multiple properties while taking on less risk than if they did it alone. In addition, the process also allows individual investors to access the real estate market without having to own, finance or manage properties.
Real estate tokenization
To date, the Tokenization in the real estate sector is understood as the conversion of economic rights generated by real estate assets into tokens on the blockchain and their sale. This can also be done for properties that are under construction.
Tokens symbolize investments in real estate and are also used to digitally map properties on the blockchain. They can also serve to raise capital to develop investment properties.
The investors who buy the tokens own a portion of the asset, and each token represents direct ownership. These assets range from a piece of real estate property to shares in a company that owns real estate, to participation in a real estate investment fund, etc.
Tokenization in the real estate sector is a way of raising capital for entities, similar to crowdfunding. But instead of money in a GoFundMe account, tokenization investors use tokens on the blockchain for their transactions.
How many types of real estate markets are there?
The types of real estate market that exist fit directly with the different types of real estate investments available. In this case we are talking about four types of real estate markets:
- Residential: It is the real estate market par excellence. All the residential properties where people live come into play here. That is, homes.
- Commercial: This market includes all the commercial properties we were talking about earlier. That is, office buildings, gas stations, shopping malls, etc.
- Industrial: Unlike when we were talking about the types of investments, in this case the industrial market does differ from the commercial one. The industrial market refers to factories or warehouses that manufacture or store food or raw materials. They are usually owned by companies and not by individual investors.
- Retailer: The retail market groups together all those stores that sell products directly to consumers. In this case, we are talking about clothing stores, greengrocers, bazaars, etc.
- Vacation: The vacation market is the one that refers to all those “luxury properties”, not the basic properties we need to live. That is, the properties that we rent or buy to spend the holidays.
Reental, the real estate investment platform you are looking for
Do you remember what we talked about the tokenization of assets before? Well, now you can start investing in different real estate projects without having to sell a kidney to face the barriers to entry of real estate investments.
With the Rental real estate investment platform you can easily start investing in real estate from just 100€ and with all the guarantees included. Thanks to Reental's tokenization of real estate assets, entering the real estate market is now easier than ever.
Do you have doubts? You can contact us whenever you want.
