A piece of timeless financial advice you’d hear from experts every now and then is to invest in real estate. But don’t put all your eggs in one basket. When it comes to real estate investments, a diversified portfolio is crucial. For one, it reduces your risk of loss. It provides multiple streams of income, increasing returns and protecting your savings.
If you’re keen on diversifying your portfolio of real estate investments in 2020, here are some property trends you may find lucrative:
Invest in Real Estate Investment Trusts (REITs)
The Security and Exchange Commission recently announced they’re optimistic that REITs will finally take off early this year, as they work on the amendments of the decade-old law. This type of investment is just like mutual funds, wherein you can buy real estate stocks from a publicly-listed corporation. As a shareholder, you earn a portion of the income generated from the properties. The types of real estate vary. It includes residential, commercial, retail, hospitality, and healthcare.
REITs are the answer to aspiring investors who don’t have the time or the capacity to deal with the intricacies of buying actual property. For instance, overseas Filipino workers who can’t carry out due diligence, talk to tenants, or maintain rental units because they’re abroad can pool funds for REITs and get good returns. Given the infrastructure boom in the country, it’s worth adding REITs to your real estate investments this 2020.
Convert Lots to Warehouses
When it comes to properties, rental apartments and bed spaces come to mind as investment options. These are not your only choices. Industrial real estate is equally promising. The main benefit? The long-term cash flow. Imagine having a big e-commerce brand as your tenant: they will need a place to store their products and keep their inventory for a long period to ensure that their operations won’t be interrupted or delayed. It’s less likely that they’ll relocate, which ultimately means long-term leases.
At the same time, warehouses don’t require much maintenance. For one, industrial property tenants are a lot more careful in using facilities, since it directly affects the efficiency of their operations. As the owner, there are fewer demands when it comes to beautifying an industrial property, compared to a residential or commercial one.
So how do you find lucrative industrial lots for sale? Remember one word: logistics. Your property should be near highways, railroads, or seaports to help tenants ensure smooth operations.
Go Big on Tiny Homes
Reality television series Tiny House Nation is more popular in the United States, but its influence extends to the Philippines, especially among Filipinos looking for affordable residential arrangements. If you want to get big money savings, go small. The financial perks don’t stop at buying the actual property; maintenance is more affordable because you won’t spend a considerable amount in using electricity and cleaning the entire space.
If you’re not a tiny house person yourself, this type of property is still a good investment — as a rental home. You can lease it to students, young professionals, or starting families who will surely be attracted to the financial perks of a tiny home. Of course, it’s important to market your property well. Use online listings to expand your reach.
Invest in Co-living Spaces
Co-living spaces have also been in demand in the country lately because of its amazing benefits. The biggest perk is the fact that dwellers are able to find a community they can belong to. It’s the antidote to being alone and lonely in the big city, as its core principle is sharing living spaces while sharing the same interests and values.
At the same time, residents enjoy the co-living space’s accessibility. Co-living spaces are in locations that make it easy to go to schools or offices without the hassle of commuting. The co-living spaces in Makati, for instance, are often a stone’s throw away from shopping centers, restaurants, and even recreational areas like parks and museums. In other words, there’s plenty of opportunities to work hard, play harder. It’s in demand among professionals and students, so if you want to catch this market segment, add co-living spaces in your real estate investments this 2020.
List down investing in property as your top priority in terms of new year’s resolutions. Make 2020 count by diversifying your portfolio and earning the financial rewards of not putting your eggs in one basket.