If you want to invest in real estate, you have heard of buying a property in pre-sale, why is it said that it has such a good performance? How does it work? And above all, can you earn money in presales?
What is a real estate pre-sale?
It is a stage in the development process of a property in which it has not yet been built and it is essential to promote everything necessary for this.
What construction companies are used to be to make sales in stages and, the earlier you buy, the cost of the apartment is lower and the risk of the investment is greater.
This is how they consolidate what they call “the lists”: List zero or friends and family, list 1, list 2 and so on, consecutively until the construction is ready and can be delivered. In this way, pre-sales have a different return on investment margins, the highest being that of the zero lists, which can be around 20%, depending on the project and other market variables. This being one of the ways to earn money in presales.
- Do you want to buy a house? do it in pre-sales stage
- How to access the lowest prices when buying a new home?
Risk in the home buying process
You know that there are a great diversity of forms of investment, each one offers a series of conditions and returns.
Of all of them, assets such as housing offer you specific conditions that other financial instruments do not, so we know their economic behavior over time and by the type of asset. They all have a different behavior! , then they serve different investment objectives.
In general, investment in housing is considered suitable for a conservative investor profile because it is categorized as low risk, although this arises in comparison with others with much more uncertainty, such as the stock market, for example.
Now, within real estate investments, specifically in housing, there are also different levels of uncertainty, and therefore, of risk and opportunities for return when buying a home or when making money in pre-sales.
The same rule applies to all investments: the higher the risk, the higher the return on investment.
How to choose the perfect investment project for you?
Why is investing in real estate pre-sales attractive?
As you can see there are different stages prior to the sale of the apartment already built and ready for you to move in. Let’s think about 4 moments prior to the delivery of the department:
- Moment 0: there is an idea, developments are in full swing.
- Moment 1: development begins to materialize.
- Moment 2: there are plans, renders, sales room (this moment can also have several phases)
- Moment 3: the house already built and ready to move in is delivered.
Buying a home in the pre-sale stage represents a higher return for you, if you are thinking of investing. If you buy at this stage, La Haus offers you early access to invest in home launches with the zero list, which will leave you a better margin when making money in pre-sales than stage 2, 3 and so on until construction finish.
You see that the sooner you buy, the higher percentage of appreciation you perceive, although you should consider that there are also greater associated risks.
Normally investors have access from list 1 or 2, but now they can have it from list 0 with the accompaniment of La Haus. This is to impact the sector by democratizing investment opportunities
In addition to time, making this investment as early as possible gives you another benefit that will be important in terms of return to earn money in presales: You choose first, equal to choosing the best!
The best apartment, the best view, the best apartment, the one that sells the fastest. The inventory is more complete the sooner you decide.
What options are there to earn money on presales and monetize?
When you plan your investment in real estate, it is important to think about the moment in which that investment is monetized because depending on this, different returns are obtained.
There are many ways to earn money in presales, let’s see three:
1. Living in the house:
If you reviewed the various variables that influence the valuation of your department, it means that you chose an area whose value will grow over time in a more or less stable way. If you buy a home and live in it, over the years you will perceive a natural increase in its value and it will become growing assets to earn money.
If you buy your home in presale there is a greater opportunity for appreciation!
2. Resell before or after deed:
One option is to monetize your investment before its construction is complete and you must pay the costs of receiving it, such as deed, taxes (7% of the total value) and others. This option has a higher risk than the previous one as there are great uncertainties in the process:
Can you sell it on time? Did the valuation conditions of the area change? Is there competition to sell it?
But if you manage to overcome these uncertainties, you will have a return similar to 20% in 2 years, which, if you compare it with other financial instruments, is considerable.
3. Short or long term rental (traditional):
These strategies are used to obtain money periodically, that is, to have a constant income. This is parallel to the profitability that you have directly on the property.
This rent depends on the market, on your ability to host short- or long-stay platforms, among other points that you should consider.