Real Estate Investment: What is it?

Did you know that it is possible to invest in the real estate market in different ways, each with a specific return for your objective? To do this, you need to know what real estate investment is and what types of investment options are available on the market when it comes to investing in real estate.

Real estate investment is linked to the sector of the same name, which can be either from an investment in already established or ongoing constructions, such as commercial buildings, letters of credit, real estate funds or mortgages.

The choice for this type of investment is related to a characteristic highly valued by those who want to increase their earnings: the constant appreciation and security typical of the sector and it is one of the most traditional and beloved investments for those with a more conservative profile.

In this article, you will learn about the different types of real estate investment and how you can start your journey in this traditional market.

What is real estate investment?

A real estate investment works in the same way as other investments, with the allocation of an amount in a specific asset, with the intention of obtaining future gains greater than the amount initially invested.

In the case of real estate investments, this investment occurs directly or indirectly in the sector and the gains combine characteristics of fixed and variable income. This is because, although there is fluctuation in the real estate market, the fact that the asset is physical brings more security to the investor.

Types of real estate investments

When making an investment, it is necessary for the person to know their profile and their tolerance to risk, as well as the liquidity needs related to the investment. This is because each type of real estate investment has a distinct characteristic.

Direct purchase and sale of property

Buying and selling a property is considered the most traditional investment in the real estate sector. In this scenario, the investor waits for the property to appreciate in value before selling.

Properties for rent

Buying properties, such as apartments or studio apartments , to rent out is also part of the routine of investors in the real estate market. Having a good location and being renovated can help keep the property occupied more frequently, contributing to reducing the owner's costs.

Real estate funds

Real estate investment funds, known as FIIs, are investments made jointly to invest in large projects in the real estate market . Shopping malls and commercial buildings are the best known. To invest, you need to open an account with a stockbroker.

In this type of investment, the person receives a return on the amount invested through the process of renting out the property or selling the acquired asset, through the Stock Exchange. It is considered a variable income investment.

Real estate credit titles

Real estate credit securities, in turn, are grouped into fixed income investments, in which the person invests in a specific construction or property owned by third parties, and is guaranteed to receive the amount back with interest on the income.

There are many different types of real estate credit instruments, but the best known are Real Estate Credit Letters (LCI), Real Estate Receivables Certificates (CRI) or Mortgage Letters (LH).

Conclusion

Investing in the real estate market can be an interesting alternative source of income, due to the wide variety offered by the sector. Like any investment, it has advantages and disadvantages, which the future investor should be aware of.

Having the support of professional operators, such as Citas, to reduce the bureaucracy of this type of investment is essential to ensure your objectives and guarantee peace of mind when investing your assets.

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