Property investment remains profitable – what can you expect?
The past year has been turbulent in many respects, with many sectors of the domestic economy suffering. The property market has also experienced more than a few shocks and took a somewhat unexpected direction this year. It is therefore natural that people are beginning to question the profitability of property. However, according to experts, properties will not lose value, and investing in them remains one of the safest ways to grow your money.
Over the past few months, almost everyone has felt how important it is to have a financial cushion. It is therefore only natural that building a financial reserve, and investing as such, have become among the most important topics of today. “Personally, I think that people previously built up reserves in case they were temporarily ill or lost their job. However, few could imagine needing funds to get through almost an entire year without a regular income. Hardly anyone expected what 2020 would bring. It is therefore logical that most people are now trying to think further ahead and ideally see at least two steps ahead. There is more discussion about life insurance, investment funds, cryptocurrencies and, last but not least, property,” says David Novotný, owner and managing director of the independent real estate company Bohemian Estates International.
The company also focuses on managing flats for short-term rental, giving it a front-row view of how an economic sector built up over years collapsed like a house of cards within a few weeks. “Short-term rentals undoubtedly suffered the most, and I have no doubt that many people tried to get out of owning such a house or flat as quickly as possible after the first wave of the coronavirus pandemic in spring. However, we found a way to ensure stable rental income for the owners of these properties by simply shifting our focus slightly to a different clientele. The properties we manage therefore remained profitable,” says Novotný of the change in strategy that Bohemian Estates International had to implement last year. In his view, this is one of the advantages of property investment.
“Property is very stable: people will always need a roof over their heads. At the same time, however, the way it is used can be adapted to the situation. You can live in it yourself, rent it out long-term and, once tourism returns to the Czech Republic in full, resume short-term rentals. And if the worst comes to the worst, you can always sell the property. You will not lose out with any of these options – provided, of course, that you have experience and know-how on your side,” Novotný adds.
Mortgage rates are currently low and, although the requirements for obtaining a mortgage are stricter than they were at this time last year, for example, you are unlikely to find cheaper mortgages in the years ahead. However, if you decide to invest in property, you should have a clearly defined strategy from the outset. “If someone is planning to buy investment properties, we will be happy to help them find the right one, negotiate a discount and take care of property management and any future sale. This enables us to maximise the final profit and prevent potential issues. Simply contact us and, together with the client, we will determine the most effective approach to ensure that the property becomes the profitable investment we expect it to be,” concludes Novotný of Bohemian Estates International.