Is it worth investing in a hotel room?
Historically, Brazilians have special liking for real estate investments. Because of this, it is natural that new options emerge to expand the range of businesses that can be done in this industry. Investing in hotel rooms is a growing trend, and so-called condo-hotels have received special attention from those who want to put money into businesses that can be profitable and at the same time does not require so much management time.
Here are some practical tips that will help you evaluate whether it is worth investing in a hotel room:
Check your future partners before investing in hotel room
The growth of investment in condo-hotels is explained by the fact that many construction companies find it difficult to obtain financing from banking institutions. Therefore, the money coming from the investor application is an outlet that can be beneficial to both sides. For this partnership to be successful, it is necessary to take into account some important factors with regard to conduct and risk analysis. Here are some of them:
Investigate the history and profile of the construction company responsible for the property
This caution sounds like some kind of investor control over the work of the construction company. Taking into account issues such as the quality and success of other real estate developments made by it, especially in the business hotel, is key to reducing the risks of such transactions. One way to simplify this process is to talk to investors who have already invested money in the construction company’s projects and check how their profits are and their satisfaction.
Check the history of the hotel chain that is responsible for the room
Research into the market strength and management-administrative capacity of the company that will make daily control of your hotel room is necessary to avoid future problems with the quality of service presented and hence increase the chances of profit. Because condo-hotels belong to associations called pool, all or several units of the establishment are autonomous and managed by the responsible network, so this relationship must be as close as possible.
Seek expert advice to manage risks
Based on what has been exposed in the previous topic, it is necessary to manage all the risks involved when investing in hotel room. To facilitate the process of investment analysis, the work of specialized consultants such as real estate law specialists and financial analysts can be used. Questions such as the average annual profit (taking into account periods of low and high season) and how it can be diluted in the months of the year, possibilities to dispose of the property if it is not performing as expected or even because it has been valued enough, which will generate profit in relation to the investment that was initially invested, must be taken into account in the search to solidify the prisms that are of this type of negotiation.
With these tips, it is easier to bet on this investment with less risk and greater possibilities of profit! And then, did you see how worth investing in a hotel room? Share your opinion here in the comments!