Depending on the liquidity of the asset, i.e. the ability to sell it quickly, mutual funds can be open, interval, exchange-traded and closed. Real estate funds are usually closed: you can simply buy shares at any time in the bank applications, but you can redeem them after the closing (the terms are specified immediately). Exit the fund before the scheduled date can only resell the unit to another person.

Profitability here provides a change in the value of the share: it grows with the price of real estate and fees from tenants. The frequency of repayments depends on the strategy:

If the fund invests in commercial real estate that is under construction, you will only be able to make a profit once it has been commissioned. No money will accrue to the account until the unit is sold.
If the fund buys completed properties, unit holders receive interim rental income every quarter. You don’t have to wait until the unit is redeemed to receive income. Agreements with tenants are signed for a long period (5 to 15 years), which ensures sustainability of payments.

In any case, after the closing of the fund real estate is sold, and the money is distributed among the investors. The amount of the initial deposit increases at the expense of profits from the increase in property prices.

There are risks in this way of earning money. For example, premature departure of tenants or a decline in the market value of the property can affect the profitability. To ensure that the unit is stable, you should carefully study the mutual fund before buying: check its history, reviews, and see what kind of clients it works with.

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Psychological willingness to take risks: do you perceive risk as a threat or as an opportunity to make money?
Financial Capability: what is your budget, do you want to use leverage?
Goal setting: how much do you plan to earn?

Real estate options:

Buy a fully ready-to-rent property – residential property or commercial space in major shopping and economic centers.

Buy a completed property and invest in renovations to increase capitalization and rental value. This can be supermarkets and shopping malls, existing leased space, residential properties.

You are willing to take a risk and want to earn more. It is worth taking a closer look at value-added projects. The essence of the strategy: buy, improve, sell more expensive. Or buy the property, increase its value, rent it out for several years, then sell it.

This strategy requires your involvement and participation. You will also have to think about hiring a management company and a team of specialists: a lawyer, a tax consultant, builders. And consider the risks, such as higher repair estimates, long sales, and time-consuming paperwork.

You are willing to put everything on the line, and you have the material, physical and psychological resources to do so. Pay attention to development projects. This strategy is for those who want to maximize profitability. Such a project can bring from 10% per annum and above. But the profit depends on the stage at which to exit the investment. At different stages – different profitability. This plan will only suit experienced investors with a team of experienced professionals.

What to invest in
The most liquid type of real estate – micro apartments, studios and small one-bedroom apartments. They are always in high demand: many people want to live comfortably, but are not willing to pay a lot. Such real estate is always quick to sell, quick to rent, quick to buy. Advantages – a relatively low cost, high demand, good profitability, high liquidity.

The hotel business can be unprofitable, if you are not a pro and had no experience in this field. To get a large income, the case will have to be handled independently and purposefully. It is not reasonable to invest in a hotel 20 million euros to get 5-6% per annum. The advantages – a variety of proposals (restaurants, hotels, offices, warehouses, nursing homes), a good income, subject to a professional approach and personal control. At the same time, the risks here are quite high, liquidity is low, there is a high entry threshold and dependence on external factors (economy, politics).

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The goal of real estate management is nothing other than a qualitatively and quantitatively predictable result of owning, disposing of and using the corresponding real estate object. The expected result is differentiated depending on the type of real estate object, the stage of the lifecycle of the real estate object, and the intentions and goals of one of the main real estate market participants (owner, investor, real estate user and real estate manager).

The strategic goal of each participant is expressed not only in quantitative (financial and economic), but also in qualitative terms.

In addition, it should be taken into account that the same real estate market participant may be interested in the objectives of several real estate market agents (for example, an investor constructs an office building, subsequently becomes the owner of this building and places his own business there), for which reason the strategic objectives of a particular participant may change over time, be replaced and combined with the objectives of other participants.

The consolidation of the most significant real estate assets of different functional purposes in groups of companies of the corporate type is characteristic of investors. The main purpose of such unions is to obtain results from real estate investments, namely to maximize the income received from real estate, increase the value and diversify the real estate portfolio in order to reduce potential risks.

In turn, private owners form large real estate portfolios specializing in a particular function (e.g. office) and concentrating on one market sector (e.g. Class A office rental). This approach creates the conditions for leveraging economies of scale during real estate operations, which minimizes costs associated with real estate maintenance, preserves the value of the real estate portfolio and introduces a single, strategically focused real estate portfolio management.

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Of course, the most profitable is a short-term rental property in some resort town or in the center of the capital. But that is not the main thing.

Any owner can start to rent an apartment – it is not difficult.
The more so that this kind of rent is very popular lately among tourists, single travelers, business travelers and those who simply came to the city on their own business.
How to find guests or tenants and earn more? Go posting ads or standing around with a sign?
These options are time consuming and costly in every sense.

So the best way to simplify the process is to use modern technology. Such as the Internet.

Various bulletin boards, services and applications for booking, where many owners place their offers, will help.

Potential tenants browse through the cards with descriptions of housing and clarify the necessary information, then book.
The owner has only to agree on a showing and handing over the keys for a fixed fee.

And still you will have to go out of the house, and not only to meet the guests, but also to clean the apartment and pay for the utilities.
So what to do?
Use the services of assistants, relatives, neighbors, real estate agencies, realtors, or a professional property manager.

In many countries, it is common practice to rent out your home for a few days.

Owners themselves rarely do this, preferring to assign all the worries to someone else.

And most often they do not even meet with their tenants, sometimes they are in another place or in another country, and only receive payment from the rent on your bank account.

Who can you trust to rent your apartment if your relatives have no time, too?
The best option is a specialist, with whom a contract for the provision of rental services is concluded. There are many options of companies, agencies and agents that professionally deal with this.

If you contract with a trusted rental management company and entrust them with all of your worries, you can never leave home at all.

Because they will do all the basic work: from posting ads in services and apps, to welcoming guests, cleaning, and more.

They keep an eye on the order and property of the property owner, helping him to earn money from the comfort of his own home.

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The principle of complexity of management. Real estate management activity implies systematic decision making aimed at achieving the goals of the owner and their implementation at all stages of the life cycle. A full-fledged process of real estate management can be provided only if the necessary condition of covering the entire life cycle of the object is met.

Principle of separation of ownership and management – the principle of real estate management, in accordance with which in the process of management there is a separation of functions of the owner and manager. The owner retains the functions of adopting strategic decisions and quality control over management.

Principle of purposefulness of management – principle of real estate management according to which the founder of management must determine and fix the goal it pursues and the achievement of which the object serves. The objectives of the founder must have an appropriate quantitative and qualitative expression that allows to assess the degree of their feasibility and the results of the activity to achieve them.

Principle of object-based management is to create a management system that would allow the adoption of management decisions, recording revenues and expenses in the context of each individual object of real estate.

The principle of the most efficient use. According to this principle, the management of real estate object should provide the best and most efficient use of it. The best and most efficient use (BOO) is defined as a reasonable and possible use that best achieves the goals of the owner.

The principle of economic feasibility of management decisions. Management decisions must be made in accordance with clearly defined criteria, on the basis of reliable and comprehensive information about the state of the property, the state of the real estate market, trends in economic phenomena and processes. This principle implies a complete inventory and accounting of real estate objects, the creation of a cadastre of commercial real estate, including a system of technical, economic and financial indicators that adequately reflect the condition and major trends in the use of real estate.

Principle of professionalism of management – the principle of real estate management, which lies in the fact that the managing company (personnel of the management company) must have the necessary amount of knowledge and skills to provide qualified, high quality, meeting modern requirements of professional services.

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The subgoals of operating property management could be as follows:

• Ensuring that the owner’s core business activities are performed;
• maintaining a good condition of the property;
• minimizing the cost of maintaining and operating the property;
• preserving the value of the property;
• increasing the owner’s prestige as a result of owning the corresponding real estate object.

The second group is commercial real estate – real estate that is not used directly by the owner and is intended for commercial operations with it (sale, lease, etc.). In this case the property is acquired for the purpose of making a profit. The sub-targets of commercial real estate management may include:

• generating a periodic income and maximizing it;
• increasing the value of real estate;
• reduction in the tax base for the organization’s property tax;
• real estate speculation;
• maintaining the good condition of the property;
• minimization of costs for maintenance and operation of real estate;
• increasing the owner’s prestige as a result of owning the real estate object in question.

The third group – real estate as an investment tool – the owner uses real estate as an object of investment in order to preserve and increase their own capital.

The investment goals are similar to the goals of commercial real estate management, namely:

• preserving the value of real estate;
• to obtain a periodical income or to increase the value of the property;
• increasing the prestige of the owner as a result of owning the property.

When it comes to the state as a major real estate owner, social goals are added to its operational and commercial goals:

• stimulating the development of small and medium-sized businesses by making it as easy and convenient as possible for entrepreneurs to access real estate;
• creation of a favorable climate for increasing investment in real estate;
• creating a favorable economic and social environment for the population;
• preservation of real estate value;
• maintaining the good condition of the property;
• minimization of costs for maintenance and operation of real estate.

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