Investing in real estate TODAY

Investing in real estate TODAY

12 June 2020


Why invest now?

In times of crisis such as the one we have experienced, the search for short-term returns on one's investments is an important issue more than ever.

Real estate investment has always represented a refuge for those seeking controlled risk and the possibility of generating a return. In order to do so, however, it is typically necessary to know how to identify the right property, negotiate the price and, above all, have sufficient capital to purchase at least one apartment, which can eventually be renovated and resold, with all the associated complexities that need to be managed.

Today the real estate crowdfunding allows you to participate, even with small amounts, in operations of this type, but larger, managed by experts, which until now were reserved only for professional investors or with large assets, and are able to offer high returns to their investors over a short time horizon.

But does investing in real estate at a time like this, in a country that has just come out of a 3-month lockdown that has impacted all economic sectors, make sense?

The resilience of real estate

The real estate market is growing compared to previous years: in spite of the situation created during pandemic, more than 70.6 billion euros were invested in Europe in the first quarter of 2020, 46% more than in the same period of 2019 and 25% above the five-year average, but 29% less than in the last quarter of 2019 (study by Savills European Research).

It is therefore a momentary stop to market growth, not a loss, as the foundations of the pre-pandemic situation were solid, especially in those centres, such as the suburbs of Milan, which were a driving force for the sector during 2019. A stop due to an inability to conclude negotiations due to the lockdown, not a decrease in demand.

From an analysis conducted by Moody's (Covid-19 impact Heat map) on the effects produced by the pandemic in various sectors of the economy, real estate is cited among those that have had a very low impact; the real estate market is to be considered particularly resilient and one of the cornerstones of the restart.

"The house remains a refuge, now even physically, so in the long term we do not expect any collapse due to the coronavirus from the point of view of first home purchases nor of houses as investment assets," says Angelo Cinel, CEO of Wire Consulting.

New housing needs

The pandemic has changed the way we relate to our homes, and we have all understood the real importance of this.

Already today, on the real estate portals and in the agencies, there is a strong unmet demand for housing and a scarce offer, signs of a desire for change that calls for a new product.

A survey by Nomisma, a research and consulting company that also runs an observatory on real estate, shows that, despite the effects of Covid, housing demand is at last year's levels and the lockdown has increased the ability to save to 75% of Italian families. Moreover, the panorama is favourable to purchases, with very low interest rates applied to mortgages, even below 1%.

In relation to the new housing needs, which see an increase in demand for properties that offer large spaces both private and common (also for smart working), gardens and balconies, we will already see in the short term a greater dynamism in the real estate market, especially in areas where investments are being made to redevelop, also at infrastructural level.

These needs will lead many more people to choose to buy a property in more peripheral areas but with good growth prospects, both for the lower prices and for the space and a better quality of life compared to the central areas of large cities.

Are you interested in real estate equity crowdfunding? Stay tuned!

Do you want to invest in a project that reflects the new needs born in the real estate market?


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