Advantages Of  Real  Estate  Investment 101
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Advantages Of Real Estate Investment 101

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Advantages of Real Estate Investment: Why is it BEST for YOU?

Advantages of Real Estate Investment: Why is it BEST for YOU?

Find out how you can benefit from this BOOMING Industry in CEBU....

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Advantages Of  Real  Estate  Investment 101 Advantages Of Real Estate Investment 101 Presentation Transcript

  • REAL ESTATE 101
  • Why do in ESTATE? INVEST REAL
  • INTRODUCTION TO THE REAL ESTATE MARKET
  • Supply and Demand
    • The Real Estate Asset Market (Property Market)
    Supply Investors Wanting to Sell Demand: Investors Wanting to Buy Market DEVELOPERS BUYERS
  • YOUR CLIENT Supply Property Owners (Landlords) Demand: Property Users (Tenants) Market
    • The Space Market
    RENTAL MARKET Supply and Demand
  • What do people USUALLY invest in?
    • LIFE INSURANCE
    • PENSION FUNDS
    • MUTUAL FUNDS
    • BANKS
    • - STOCK MARKETS
    • - TREASURY BONDS
    DIFFERENT CONSTITUENCIES, EXPERTISE, LIABILITIES, REGULATIONS, SIZES
  • TWO MAJOR INVESTMENT OBJECTIVES INCOME G R O W T H Relatively Long-term (Appreciation) Short-term (On-going need for Cash Inflow)
  • The ADVANTAGES of Real Estate Investment
  • RISK CONTROL = ADVANTAGES OF REAL ESTATE INVESTMENT
  • ADVANTAGES OF REAL ESTATE INVESTMENT
    • CASH FLOW
    • = PASSIVE INCOME
  • ADVANTAGES OF REAL ESTATE INVESTMENT
    • RENTAL YIELD is more than
    • BANK SAVINGS RATE
    MORE INCOME
  • Gross Rental Yields - Philippines Compared to Continent 10.99%
  •  
  • ADVANTAGES OF REAL ESTATE INVESTMENT
    • LEVERAGE
    • (CAN BE USED AS COLLATERAL )
    BANK
  • ADVANTAGES OF REAL ESTATE INVESTMENT HEDGE AGAINST INFLATION INFLATION
  • ADVANTAGES OF REAL ESTATE INVESTMENT
    • INFLATION VS.
    • CAPITAL GAIN RATE
  • House Price Changes, 5 Yrs (%) - Philippines Compared to Continent
  • ADVANTAGES OF REAL ESTATE INVESTMENT
    • FLEXIBILITY /
    • EXPANDABILITY
  • ADVANTAGES OF REAL ESTATE INVESTMENT
    • DEPRECIATION
    • (HEDGE VS TAX)
    TAX
  • ADVANTAGES OF REAL ESTATE INVESTMENT
    • POWER OF AMORTIZATION
  • ADVANTAGES OF REAL ESTATE INVESTMENT
    • PREDICTABILITY/
    • CONSERVATIVE
  • ADVANTAGES OF REAL ESTATE INVESTMENT
    • LIFETIME
    • INVESTMENT
    NEW COUPLE YOUNG FAMILY MID-LIFE STATUS RETIREMENT SINGLE STATUS Different Lifestyles , Life Cycles , Personal Goals , Levels of Wealth LEGACY
  •  
  • HOW TO MAKE MONEY OUT OF YOUR REAL ESTATE INVESTMENT?
  • POWER OF CASH FLOW
  • With your investment…
    • You have the Opportunity for
    • Passive Income
    • EXAMPLE: LA GUARDIA FLATS 1
    • Monthly Passive Income = P12,000 / mo
  • With your investment…
    • You have the Opportunity to Loan
    • More financing institutions grant loans when you have passive income
  • With your investment…
    • You have the Opportunity to Invest
    • As you earn passive income, you have the opportunity to invest in another property, in effect, gives you more passive income in the future.
  • POWER OF MORTGAGE
  • With your investment…
    • You have the Power to use your property as Collateral
    • Mortgage rate is relatively lower than rental yield
    • Even assuming that it is equal, lessor pays your debt or mortgage payable
    • In effect, more amount gets paid, and your equity increases.
  • POWER OF DEPRECIATION
  • With your investment…
    • YOU HAVE THE OPPORTUNITY FOR TAX SHIELD
    • CAN BE DEDUCTED AS EXPENSE, THUS LESSEN TAXABLE INCOME
    • SPREAD OVER THE LIFE OF THE PROPERTY
    • IN MOST CASES, PROPERTY APPRAISES
  • POWER OF EQUITY
    • RESALE
    • 30% / 70% RATIO
    • PROPERTY APPRAISES
    • FROM 1.35 TO 1.6, INCREASE OF 250T
    • AFTER 2 YRS (RFO), GROSS INCOME OF 60% OF INITIAL INVESTMENT FOR RESALE.
    • LOANABLE AMOUNT 1M,
    • MINIMAL TRANSFER FEE
    • FOR MORE GROSS INCOME, INVEST ON MORE PROPERTIES.
    • MAKE SURE THAT IT IS A WELL LOCATED PROPERTY
    • DEVELOPED BY A REPUTABLE DEVELOPER
    • IF PROPERTY IS NOT WELL ESTABLISHED, HARD TO SELL).
    • POWER OF EQUITY IS GOOD, BUT IT HAS TO BE A GOOD PROPERTY, WITH TRACK RECORD OF PROPERTY APPRECIATION EVEN MORE THAN INDUSTRY STANDARDS.
    POWER OF EQUITY