Stocks, bonds, funds… When comparing different investment options, real estate proves to be by far the most attractive asset.
But what is the reality?
Negative interest rates have been imposed for several years on deposits by central banks, such as the European Central Bank (ECB) or the Swiss National Bank (SNB).
These measures, which are part of an expansionary monetary policy, are intended to stimulate the economy.
Indeed, holding cash becomes less attractive, which encourages investment. As for cheaper credit, it boosts demand.
The question then is whether this theory works in practice?
Good News and Bad News
This financial maneuver obviously has repercussions for individuals.
Starting with the bad news, the situation has led banks in the country to completely eliminate interest on savings.
In other words, taking inflation into account, keeping your money in an account will cost you money! It’s better to consider another more profitable solution.
The good news is that these historically low interest rates also present advantages.
Indeed, real estate markets have experienced remarkable growth in recent years, as Francesca Boucard from Swiss Life Asset Managers confirms in the pages of Allnews.
Now, investing your assets in residential property offers returns that exceed other types of investments.
By way of comparison, in Switzerland, rental yields average 7.05%, while the average performance of stocks is 2.89%, bonds 2.5%, and the money market 1%.
No Room for Improvised Investment
While the promises of real estate investment may seem tempting, you shouldn’t imagine you can invest recklessly… Remember that it is vital to know the market well before preparing to invest!
Ask yourself the right questions:
- What is the location of the property?
- What is its rental potential?
- What is its fair price?
- What are the steps to undertake?
These aspects must be evaluated to be sure to invest your savings wisely.
Investment Security: The Strength of Real Estate Crowdfunding
Real estate proves to be the safest investment in the short, medium, and long term.
Indeed, rents represent a regular cash flow with the possibility of a capital gain upon resale of the property.
Due to the economic situation, there is now a growing number of individuals venturing into this field. While most have substantial funds, there are now solutions that make real estate investment accessible to all budgets: real estate crowdfunding.
The strength of this approach is that it allows investors to come together around a project by pooling their savings and thus access co-ownership.
With a minimum investment, you can secure a fixed, stable, and monthly income ranging from 5% to 8% over a usual period of 3 to 7 years.
Key Takeaways
Investing in rental real estate remains one of the most advantageous investments. However, it is recommended to have a good understanding of the real estate market. If you don’t, you can trust professionals such as Imvesters who know this market. This will allow you to delegate everything and invest with peace of mind.
The rental risk always remains and must be taken into account. This is where the real estate crowdfunding solution is even more interesting.
Besides being accessible to the widest audience, it dilutes rental risk compared to an investment in condominium ownership (PPE), for example. It grants the owner exclusive rights to use a specific part of the building, namely a single apartment.
