The outlook for the home buying and selling sector is very positive for 2018 as it is estimated that the number of operations will grow by 18%. In this sense, real estate crowdlending can become one of the alternatives to investment from now on due to the weakness shown by the equity markets. With falls in some of the most relevant stock indices of more than 10%. From this perspective, crowdlending is a collaborative investment that allows investing small amounts of money in real estate projects, both in purchase operations and rental of houses.
It can be said that the so-called real estate crowdlending is a new trend that has been installed in the investment sector, but with significantly different approaches with respect to the traditional ones. It bases its strategy on positioning itself in the real estate, but without making excessive monetary efforts, and jointly with other investors with the same characteristics. With the aim of participating in the benefits of the purchase of any property (homes, premises or even offices).
As a consequence of this strategy, these operations are easier to complete since, due to the low amounts required for their investment, it allows access to practically all households. Not in vain, it can be accessed from only 1.000 euros on some platforms with these characteristics. With the possibility that the return can reach around 10%, with a period of permanence that can range between 6 and 16 months approximately. Through an investment model that stands out at the moment for its complete innovation.
Crowdlending: take advantage of the sector
All this, in a context like the current one, where the real estate market is in clear progression in Spain. Taking a very active part in the growth of the Gross Domestic Product (GDP) that closed last year with a rise of 3,1%. Although recently the International Monetary Fund (IMF) has lowered its forecasts to 2,4% for 2018. In this sense, users can take advantage of the fact that the real estate sector is one of the most powerful in the economy national. Above other strategic segments, such as electricity or even banking.
The outlook for the sector is clearly positive according to the data provided by the recent report Residential Market in Spain that has been prepared by Servihabitat. In which it is shown that the sale of homes will grow more than 18% in 2018, above 550.000 operations. A figure that invites investment through the acquisition of real estate and indirectly in the securities of the real estate sector that are listed on Spanish equities.
Project financing
But if you do not have the purchasing power to deal with these operations, there will always be the option of opting for real estate crowdlending. Although with a series of shadows that will be necessary to warn to prevent possible incidents in investment. Where perhaps the greatest risk of these operations lies in the fact that this is still an incipient market in Spain. Where the platforms where to invest the money are still a minority and move with business models somewhat different from each other.
This innovative strategy allows investment groups to finance projects related to the real estate sector, without resorting to the credit lines offered by financial institutions. In this way, they manage to eliminate a series of expenses in your operations that reduces the cost of the projects. Not surprisingly, it is small investors who offer it to them so that they can be rewarded through a return that can reach 15%. In any case, more complicated to obtain through the equity markets and totally impossible in fixed income or banking products (time deposits, promissory notes or savings plans).
Performance of operations
However, it is not a fixed return every year, not even in months. But on the contrary, it depends on the evolution in the housing prices. This is one of the main reasons why notable fluctuations are generated from one operation to another depending on the moment in which the money is invested. It is not always the same and therefore you have to take advantage of the upward trend in the real estate market to improve interest. The higher the economic growth, the higher the returns to investors. Through a range of returns ranging from 2% to 15%.
In any case, another of the most relevant characteristics of real estate crowdlending is that it covers all kinds of real estate projects, from the purchase of real estate to the rental apartments. From the flats located in the center of the large towns to other real estate proposals that leave our borders to invest in the always-helpful brick. For example, in Italy, France or other countries in our closest environment. Although in any case, with a return very similar to that generated in the investments of our country.
Registered with the CNMV
It takes a short wait to obtain the estimated benefits, between approximately six months and three years. This is one of the drawbacks of this investment. Although the most important is derived from the little transparency that crowdlending platforms can provide. To remedy this potential problem, investors will need to ensure that these companies are registered with the National Stock Market Commission (CNMV). Not surprisingly, it is the best strategy to avoid incidents in operations.
Furthermore, this collaborative model investment does not allow large investments. But on the contrary, the minimum contributions range between 50 and 10.000 euros. Unless the investor is accredited and in which case he will be in a position to exceed these margins. Although for this it will be necessary that you provide a solvency in your personal accounts. For example, having an annual income of more than 50.000 euros and a financial assets of more than 100.000 euros. From this moment on, all that remains is to choose the real estate project that may be more profitable, depending on its location and the characteristics of the project.
No alternative to investment
From this moment on, you must be the one to determine whether or not it will be worth investing the money in this alternative to investment that is somewhat special. With its risks and advantages, but in any case it can be interesting at a time when there are really no options for investment. Because indeed, fixed income products they barely offer a yield above 1%, even though it is fixed and guaranteed in all situations.
While on the contrary, equities have left the profit margins that they enjoyed between 2013 and 2017 and can enter a downward spiral that is very dangerous for your personal interests. In this sense, you cannot forget that the selective of the Spanish stock market can dismiss the year with falls above 10%, while the Eurostoxx 50 is leaving almost 10% of its valuation this year. To the point of saying that equities are no longer as profitable as in other years. Although it is not yet known with certain certainty how far this situation will go in the equity markets. The higher the economic growth, the higher the returns to investors.
Advantages of crowdlending
In any case, this kind of alternative investment can offer you a series of benefits that can be very interesting so that you can make profitable the available capital from now on: What are these benefits that are reported from these operations in the real estate market? Well, they are of various kinds and with different connotations such as the ones we provide below:
- La flexibility in the economic contributions is one of the common denominators of these operations carried out in the important brick sector. From very affordable amounts to others that really require a greater investment effort.
- You will also have several alternatives when it comes to term of stay. That is, you must have the money immobilized with the possibility of rescuing it at any time. Not in partial or total operations. As one of the great drawbacks of real estate crowdlending.
- All the platforms There are still very few who market this product for investment and some of them are unregulated. In this sense, you will have no choice but to look for those that offer the highest guarantees.
- This sector has a upside potential very high as long as the real estate sector is under an expansive phase in its growth. Beyond other technical considerations that will also have to be foreseen in the investment.
- And finally, you cannot forget that it is a expanding sector that can generate large dividends from now on as a result of the great returns that can be found in the brick.