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When is Profit Made in Real Estate?

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How to Invest in Real Estate
Nova Property

Real Estate InvestorsThere are a considerable amount of investors in Turkey. As a community which has been raised with the principle of “having a property of one’s own”, the idea of buying a home is planted within our genes, even if we do not actually buy one. On the one hand, everyone in Turkey is in a flap about earning a lot of money, and earning it quickly. Perceptions in this respect are very clear. Wherever there is a potential presented as a possibility for making money, we make long queues there. It is in fact like this in most places around the world. However, what is strange here is that no one actually considers themselves as an investor. When we talk about investors, we are actually thinking of someone who buys something for amounts with at least six zeroes. However, an investor is a person who buys something to make money from it. For example, if you live in a rented home but buy a home to rent it out yourself, even you, are an investor in real estate sector. In my opinion, you are a bad investor under these circumstances, I need to add.

If you become conscious that you are an investor…
It is very important that you become aware of this yourself. If you become aware that “in fact” you are an investor, you will then speculate about the sale of the property you have purchased. If you are considering selling that property at an indeterminate time, and you say, “the home is mine anyway, I can sell it anytime I want, after it has gained in value a little”, let me say in advance that, there will be a good possibility to make a loss from your profit. Even if you have bought a property only for its rental income, and not to live in, you should still have a target to sell it. That is because as the building gets older rental income will fall. If you have purchased a home from a project and rented it out, the project will become old. You should most definitely determine a sales price and time in order to avoid your money losing its value.

When should we sell?

Real Estate Value RisingIf you have purchased a home from a property project, under normal circumstances prices reach their highest levels six months before and six months after the completion of the project. So, what are normal circumstances? This is the period of time when your project will reach its highest value, if there is no other project to greatly increase the value of the location being developed next to your project, and if there are no investments to greatly increase the brand value of your project. If you sell your property at the moment it reaches this value, you will maximize your profit, and then invest this money into another project which is still at the phase prior to construction.

On the other hand, if you did not buy a home in a project being sold prior to construction, but an apartment from a building which is already complete, then the first criteria for you is the age of this home. If we are not talking about a place which will be a part of urban transformation, or if we do not have a situation where all of the buildings in the area have been rebuilt, and only yours remains old, then the best time to sell is when you find another property at the same price, but with a higher rental return. Let us say that you have found a property with a higher rent for the same price. Then, try to sell during the periods when the housing sector is at peak season. The months between September – November and March – June are the peak seasons of the sector.

A good investment in Turkey will pay for itself in between 144-216 months. This varies according to the project and the location. Whether you buy a piece of land for 25 thousand liras, a home for 250 thousand liras, or a villa for 1 million euros, if you are not going to use these to live in, you are an investor. You must make your plans before the purchase transaction. Let me just say that you can be sure that you can make a profit of up to 20 percent of the value of your investment, just by selling at the right time.

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