Real Estate 101: Choosing the Best Property Investment Options in the Philippines

Summary: Investing your money in real estate is a wise decision to keep your money growing.  The goal of real estate investing for beginners is to put their money to work today to have more money from this day forth.

Read Time: 5 minutes

You may put your funds in traditional and physical estate and get a high return on investment (ROI). However, it also involves more cash upfront and can have high progressive costs.

Alternatively, you can invest in Real Estate Investment Trusts (REITs) and crowdfunding platforms. They have a lower financial barrier, enabling you to capitalize on various real estate types for less than property investment.

Financial barrier occurs once high costs make a particular activity hard to afford. It includes charges or fees for utilizing services. Besides, these strategic real estate investments likewise provide the evident benefit of not needing to leave the house just to look for an investment.

If you want to enter the world of real estate investing, check out the following types of investments. You’ll soon find out which best suits your needs and your budget. You’ll find in this article different types of investments in the Philippines that are worth your money.

Real Estate Investment Trusts (REITs)

These are firms that have commercial rental property, which includes malls, hotels, or offices. You can have a stake in these companies on a stock exchange. Investing in REITs allows you to invest in the real estate of the companies they own. You’ll be less likely to encounter risks connected with directly owning real estate.

It’s a requirement for REITs to return at least 90% of the taxable income to stakeholders annually. As an investor, you can receive decent dividends, not to mention the growth of your real estate portfolio.

Publicly traded REITs offer more liquidity compared to other real estate investment companies. If you need cash immediately, you can sell your stakes on the stock exchange. However, it’s possible with a brokerage account when you want to invest in publicly traded REITs.

Bare Land

When buying property, think of bare land as a turnkey real estate investment. The value of land does not depreciate with time, unlike cars or houses. Some investors buy land to develop for residential or commercial purposes. If you’re a property owner with deep pockets, you can set the land yourself and make your investment property for sale at a higher price.

Residential Real Estate

People can live or stay, such as in condos, homes, or vacation places. Residential real estate investment companies earn through rent collection from property tenants. They can collect real estate funds through their property’s increased value between buying, selling, or both.

Commercial Real Estate

When you’re considering a rental property investment, commercial real estate is best for you. It’s a rental or leasing space for businesses that are looking for a place to establish themselves. Rentals are more extended than residential real estate.

Crowdfunding Platforms

These are websites that allow collaboration between the crowd and fundraisers. They make financial pledges and collect them through a crowdfunding platform. If the campaign is successful, fundraisers are typically charged a cost by crowdfunding platforms. It provides investors access to real estate investments that might deliver high returns. However, they may also bring substantial risks. 

Cropital is one crowdfunding platform in the Philippines. It helps farm owners by supporting their primary source of income and provides supporters an option to earn online. It charges supporters a 5% service fee for each investment they make. The donated net funds go directly to the farmers. After the harvest and crops sale, supporters will gain a fixed percentage through farm profits.

Make the Wise Investments