So, do you want to invest in real estate?

All that glitters is not gold. When we are in search of a property, real estate market presents attractive options that not only satisfy our needs but promise us a whole range of benefits to convince us to purchase certain product: location, quality, sustainability, better landscaping and added-value. But what is this? Without knowledge of architecture, we can qualify many of the attractions that are offered to us according to our experience and comparing the various products on the market, but today, all offer this concept as part of their basic philosophy, too. Would you like to know more about it?

The added-value is a concept born in labor economics derived from the theories of Adam Smith, David Ricardo and Karl Marx. It is a term applied to the amount of output generated by a worker when his salary has been covered and still have time in to produce greater volume. In other words, the added-value is basically the utility of employee’s activity and means higher profits for the employer.

How then is translated this concept to real estate? Added-value refers to the increase in the value of any property derived from external factors that are not directly related to its main costs such as construction or any improvement to the property but to situations within the context. The location, for example, can provide added-value to our property if it is well connected and integrated into the city in which we live, if large investment projects are generated in the area such as shopping centers and facilities, if the public transport is improved or simply if consolidation has been achieved by reducing the area offerings while maintaining the interest of the people for purchasing a near property... as always, the principles of supply and demand.

The value of a building will never be increased, it is exactly the opposite; over the years the constructions become old and obsolete and require changing facilities, modernized spaces, roof and moisture maintenance that gradually reduce its value. The land is which wins the expected gain, but like energy, land values in cities are not created nor destroyed only transformed, and just as a property can earn added-value, there will be so many lands that lost and depreciate significantly. For a condo to increase the value of their properties, another has to give that percentage and in most cases, they do it so dramatically.

Most developments have acquired added-value to the passage of much time, usually when the properties are passed from one generation to another and with the economic value, have a very strong sentimental attachment. If you are looking for a property to quickly increase its value to invest your capital, is important to know the real estate market situation first hand so we left you 5 simple tips:

1 The more added-value developments are those with the most stringent regulations and codes. The construction of your neighbors can increase or decrease the value of your property and a uniform style will always be well appreciated. If the condo has been built by the developer, check their upgrade, refurbishment and maintenance codes; any poor quality extension inside the housing development, reduces the value of all properties.

2 Even in the sun, we all prefer to walk to a nice restaurant to increase our carbon footprint using the car. The closer are the commercial spaces and facilities, your property will have greater value. Location, location, location!!!

3 Condos will always have great amenities but they represent a monthly outcome you must consider because it impacts the value of your property. When buying, ask about maintenance costs and revise internal regulations; it is always good to have contingency plans and programs to maintain current the developments. In some cases that developers have sold all the properties, they stop the care of the common areas and they lose their charm.

4 There is a lot of competition and everyone offer wonderful things that cannot always be accomplished. You need to start by consolidated developments because there you will see if you really like what its offered and also find a faster gain than in new condos. If access roads, shopping centers and green areas are not yet built at the time of purchase, they may never be.

5 Meet your neighbors and their interests. If all the people who buy a property in a condo expect resell soon for profit, the supply of properties will increase significantly and that will lower the cost of resale. Remember that the higher the supply is, the cost should proportionately go down.

Spending a little time studying where you will invest your capital, will surely generate you much profit. Research, read, look at all the offers that interest you and look for serious and neutral support of qualified professionals who can give you a clear view of the market; finally, it's just your decision. If you have any questions or you want to lean on the selection of the best realtors in the area, please contact us.

JPV