{"id":212,"date":"2022-05-05T07:59:36","date_gmt":"2022-05-05T12:59:36","guid":{"rendered":"https:\/\/33holdings.com\/learning-center\/?p=212"},"modified":"2022-05-05T08:00:08","modified_gmt":"2022-05-05T13:00:08","slug":"factors-to-watch-in-real-estate-investments","status":"publish","type":"post","link":"https:\/\/33holdings.com\/learning-center\/2022\/05\/05\/factors-to-watch-in-real-estate-investments\/","title":{"rendered":"Factors to Watch in Real Estate Investments"},"content":{"rendered":"

Every investment decision should be backed by a thorough due diligence and analysis. At 33 Holdings<\/a>, we have a team of professionals<\/a> who specialise in researching the real estate markets and then arrive at a decision.<\/p>\n

While there are several permutations and combinations one should bear in mind while evaluating an investment, some of the more common aspects to bear in mind are as below.<\/p>\n

    \n
  1. General Market Risk – <\/strong>Market graphs often show fluctuations in interest rates, inflation and other fundamental economic figures. While a variation in these numbers are inevitable, investors can make informed decisions<\/a> by hedging their stakes across a diversified portfolio of properties.<\/li>\n
  2. Asset-Level Risk \u2013\u00a0<\/strong>More often than not, residential properties are in demand. Within the broader asset class of such properties, multifamily real estate and offices are considered \u201clow risk low return\u201d.<\/li>\n<\/ol>\n

    Commercial properties<\/a> such as shopping malls, hotels etc. yield a higher return on investment, the risk of the invested principal diminishing is more than in a residential property. This must be borne in mind, when deciding on an investment.<\/p>\n

    The investments team<\/a> at 33 Holdings weigh all risks a commercial property could pose before making a decision. This is done with the help of proprietary analytics and a keen sense of the real estate markets.<\/p>\n

      \n
    1. Structural Risk \u2013 Factors relating to an <\/strong>investment\u2019s<\/a> financial structure and the rights it provides to an individual participant is called \u201cStructural Risk\u201d. These are commonly encountered in joint ventures where an investor should be especially careful about their rights, their responsibilities and obligations, for instance \u2013 a remuneration to be paid to the <\/strong>manager of the venture firm<\/a>.<\/strong><\/li>\n<\/ol>\n

      In such cases, a safe method of investing would be to consult an <\/strong>industry subject matter<\/a> expert to ascertain the pros and cons of the <\/strong>investment<\/a> before going all in.<\/strong><\/p>\n

        \n
      1. Replacement cost risk \u2013 Demand for <\/strong>rental properties<\/a> drives up the lease rental rates of existing properties. <\/strong>Such spikes subside once newer properties are ready and available to be leased out.<\/strong><\/li>\n<\/ol>\n

        Such a scenario also sometimes leads to current properties being \u201cseen\u201d as obsolete, devoid of modern amenities and not up to the mark.\u00a0 Investments made in such a property could be at risk of diminishing.<\/strong><\/p>\n

          \n
        1. Leverage Risk – The more the debt on an investment, the more the risk and the more the demand in return. Leverage is a <\/strong>force multiplier<\/a> that helps move a project quickly and increase returns<\/strong><\/li>\n
        2. \u00a0Credit Risk \u2013 Risks taken bearing in mind the leaser, their length of stay and the stability of the property\u2019s lease income stream is termed as credit risk.<\/strong><\/li>\n
        3. Idiosyncratic Risk \u2013 A risk that is unique to a specific <\/strong>real estate property<\/a> or a particular asset class within an area is referred to as an i<\/strong>diosyncratic\u00a0risk. One of the most reliable ways of mitigating this risk is by diversifying the investment basket.<\/li>\n<\/ol>\n

          33 Holdings<\/a> has a team of industry professionals who come with a rich experience of the real estate market with an emphasis on the South West marketplace.<\/p>\n

          We take pride in being able to augment the investment decision making process<\/a> of our investors and help them grow their investments as safely as possible.<\/p>\n","protected":false},"excerpt":{"rendered":"

          Every investment decision should be backed by a thorough due diligence and analysis. At 33 Holdings, we have a team of professionals who specialise in researching the real estate markets and then arrive at a decision. While there are several permutations and combinations one should bear in mind while evaluating an investment, some of the […]<\/p>\n","protected":false},"author":2,"featured_media":214,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[44,46],"tags":[],"class_list":["post-212","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-property-management","category-real-estate-investments"],"_links":{"self":[{"href":"https:\/\/33holdings.com\/learning-center\/wp-json\/wp\/v2\/posts\/212","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/33holdings.com\/learning-center\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/33holdings.com\/learning-center\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/33holdings.com\/learning-center\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/33holdings.com\/learning-center\/wp-json\/wp\/v2\/comments?post=212"}],"version-history":[{"count":2,"href":"https:\/\/33holdings.com\/learning-center\/wp-json\/wp\/v2\/posts\/212\/revisions"}],"predecessor-version":[{"id":215,"href":"https:\/\/33holdings.com\/learning-center\/wp-json\/wp\/v2\/posts\/212\/revisions\/215"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/33holdings.com\/learning-center\/wp-json\/wp\/v2\/media\/214"}],"wp:attachment":[{"href":"https:\/\/33holdings.com\/learning-center\/wp-json\/wp\/v2\/media?parent=212"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/33holdings.com\/learning-center\/wp-json\/wp\/v2\/categories?post=212"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/33holdings.com\/learning-center\/wp-json\/wp\/v2\/tags?post=212"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}