Real estate investments

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MQiL62

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MQiL62
Aug 8, 2020 3 Comments

What do you guys think about investing in apartments?
I don't want to actually spend time in dealing with people.. But I know some companies can take care of everything for a small commission (finding renters, taking care of the apartment, buying it and selling it, etc). I know many are shitty and/or scammers, but the concept sounds good.
I could be interested in investing in such way maybe in small cities in Germany (I am a resident, so I can maybe get a mortgage for very low interest?) Or Ukraine, or whatever.

Did anyone ever do this and get useful return? Any companies that help?

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TOP 3 Comments
  • Dell
    vangogh

    Go to company page Dell

    vangogh
    I have not heard about companies that offer the whole package as you mentioned, but the easiest way I think would be to find a great real estate agent that sources new deals for you and build a relationship with them, as this is what their job is supposed to consist of. Theyll have the benefit of future commissions when they do a good job for you. But there are many bad apples as anyone can call themselves real estate agent in Germany without having any formal education.

    Management of tenants can then be done by specialized companies/Hausverwaltern. Again lots of bad apples here. But you could also look at larger apartment complexes where apartment owners pool together and pay a very small monthly fee for having their properties centrally managed. This can also protect you (up to a certain limit) from vacancies as the 1-2 months of rent you might be missing when someone moves out will be covered by the pool of owners. Again the management company needs to be good and the property in a good location for this to work well.

    Also stay away from crowdfunding real estate websites that are popping up all over the place. You are not actually investing in the property itself but in some kind of a mortgage financial construction - meaning that in case of the project failing you will be paid out last after all of the banks/other creditors have been paid. Also it is impossible to evaluate those investments by just looking at the official docs from the builder that are most of the time published just a few hours before the investment window closes.

    In terms of the type of real estate you might be investing, before the pandemic small apartments where great as they were not as expensive to buy as maybe 3 bedroom apartments and you could rent them for higher prices/sqm to students (with their parents guaranteeing rents) or even better to professionals with furniture included. Not sure though what the future holds going forward.
    Aug 8, 2020 0
  • Walmart
    AFamilyMan

    Go to company page Walmart

    BIO
    Been there, done that. Grey hairs.
    AFamilyMan
    Just one advice, if you planning to do it, do it in capitalist economies where your are not at disadvantage for being remote and streams of investors are revered and safeguarded when it comes to complexities of tenant related laws.
    Aug 8, 2020 0
  • I have experience with this, through a family investment. It sucks. It’s not liquid. We had a flood damage the building. An incompetent building manager had to be replaced. Roofs need replacement. As the building ages you get less desirable tenants, the ultimate fear being Section 8 welfare tenants who will trash the place.

    Best bet is to invest via a REIT.
    Aug 12, 2020 0