How to invest in real estate funds? Find out now

Real estate is a source of investment, especially for Brazilians who have this type of direct investment in real estate as part of their culture, but their indirect investment is also standing out, understand how the real estate fund works.

Direct investment in real estate is made through the purchase of real estate, with the aim of reselling or renting it out , requiring a slightly higher initial investment and may not be accessible to some people.

Another option for investing in the real estate market with a smaller investment is the real estate fund, or FIIs, which provides access to market investments with a return proportional to the fruits of the property, in a safer way.

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What are Real Estate Funds?

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There is a group of variable income add-ons, where shareholders are brought together in order to raise funds and invest in other real estate assets, which can range from residential or commercial properties, letters of credit, among others.

The fund is divided into shares, which do not have a specific quantity, they can vary in each case, they will later be sold on the Stock Exchange, which can be purchased by individuals or institutions.

The proceeds from the quotas sold are used to purchase and build properties, or to invest in financial products in the real estate market, always aiming for the best possible commercial return.

All profits from commercial exploitation, sale of properties or financial investments are shared among the shareholders, in proportion to each of their shares, that is, their investment .

What are the types of FIIs?

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After understanding how real estate funds work in practice, it is possible to understand their categories, which total four main ones: brick funds, paper funds, funds of funds and fiagros.

Brick funds invest directly in physical, ready-made properties, which can include buildings, shopping malls, hotels, among others, while paper funds invest in real estate credit letters (LCI) or real estate receivables certificates (CRI).

Funds of funds work by investing in other funds, that is, they are funds that buy shares in other real estate funds, in a diversified manner. Finally, fiagros are funds that invest the assets of the group of shareholders in assets, therefore, financing is carried out in production chains.

In addition to the four main categories presented above, there is the possibility of hybrid funds, which can be classified in more than one category simultaneously. For example, real estate funds that own physical properties can invest in other types of products, such as letters of credit.

This is the case with other types of funds, all of which can be used in a single hybrid fund. This type of application is at the discretion of the manager, who decides which is the best strategy to achieve their objectives.

It is worth noting that real estate funds are excellent options for long-term investments, those who opt for this type of investment focus on the distribution of income and the appreciation of the assets that make up the fund.

To learn more about the best investment options in the real estate market, visit our website .

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