Discover your investor profile with this test

It could be said that there are as many types of investors as there are fish in the sea, some more conservative, others more daring, all with different cases and varied objectives. That's why we've prepared a battery of 14 questions, which will take you less than 5 minutes to answer, to help you see what type of real estate investor you are.

We recommend that you write down your answers on paper or in a document so that at the end you have a complete picture of your investor profile.

Question 1: Do you prefer to buy the property with a mortgage or in cash?

Advantages of buying with a mortgage

If you prefer to buy the property by taking out a mortgage, this will mean that you could buy a property with less equity or even more properties with the same capital.

Disadvantages of buying the property with a mortgage.

Taking out a mortgage involves a higher cost (lower return) due to the associated interests, the purchase period is extended due to all the formalities and would directly increase your debt ratio.

Advantages of buying the property in cash.

By buying the property in cash, you have greater negotiation capacity and a faster purchase.

Disadvantages of buying the property in cash.

On the other hand, by buying in cash you will decapitalize and you will have a lower return compared to the capital you have invested.

If you have chosen to buy the property in cash, you can skip questions 2 and 3. Let's continue!

Question 2: Would you ask for the mortgage at 100% or at the minimum?

Advantages of applying for a mortgage at a minimum.

If we ask for it at the minimum, the costs will be lower since we will be paying less interest, and our cashflow will be higher.

Disadvantages of applying for the mortgage at the minimum.

Obviously, if we ask for it at the minimum, we will be suffering a greater decapitalization.

Advantages of applying for a 100% mortgage.

In this case, we will need less capital to buy the property, so we are going to decapitalize less.

Disadvantages of applying for a 100% mortgage

Contrary to the other option, we will have a very fair or even negative cashflow.

Question 3: Would you choose the mortgage repayment period at the minimum (10 years) or the maximum (35 years)?

Advantages of doing it to a minimum.

If we do it to the minimum, we will amortize the debt in a short time and we will have less interest because we will be paying them for less time.

Disadvantages of doing it to a minimum.

On the other hand, we would have a much lower or negative cashflow and the mortgage payment would be higher.

Advantages of doing it to the fullest.

Doing so at 35 means being able to amortize and reduce the term and that the mortgage payment would be much lower.

Disadvantages of doing it to the maximum.

But much more interest is paid since we paid it for 35 years.

Question 4: Do you prefer a type of investment with higher cash flow or with greater appreciation over time?

At this point, everyone's vision of time, whether more short-term or long-term, would come into play. If we choose a higher cash flow, it means that we will have a greater short-term return on the property, while if we choose the property with the greatest possibility of revaluation in the area, we will have the opportunity to make more profits by selling the property in the long term.

Question 5: What do you prefer to invest in premises or homes?

Advantages of investing in premises.

In local areas, investment is much more passive since the company itself is carrying out the reforms.

Disadvantages of investing in premises

Finding a tenant for that property is more complicated than for a home (everyone needs a house to live in but not everyone needs a place).

Advantages of investing in housing.

Investments in housing are in greater demand than local ones.

Disadvantages of investing in housing.

Investment in housing is much more active for the investor, homes need more care than a place.

If you have chosen to invest in premises, you can skip questions 6 and 7.

Question 6: Would you invest in a property with or without an elevator?

With an elevator we can choose a type of tenant with a higher age range (young and old) but the profitability will be lower since it is the largest expense in a community. And without an elevator we would have greater profitability but a smaller range in terms of the variety of tenants.

If you have chosen to invest in a property with an elevator, go directly to question 8.

Question 7: What would you consider the maximum height for a floor without an elevator?

Question 8: Do you prefer a new-build or second-hand property?

In new construction, the price is higher but the maintenance is lower since for a few years it is almost certain that you will not have any incidents that entail a cost.

In the case of second-hand homes, these have a lower price, but it is likely to involve a more active investment in terms of renovations or incidents, whether plumbing, appliances, painting, etc.

Question 9: Do you prefer to buy to rent or buy to renovate and sell?

Buying to rent is a much more passive investment since you will have to do some small renovation or solve a problem but nothing else. But if you invest to renovate and sell, it will take approximately 9 months or a year to complete all the procedures to be able to get rid of the property with certain profits.

Question 10: Would you buy default insurance?

If you decide to hire it, you will be protected for 6, 9, or 12 months against a tenant's non-payment or even an eviction, but it would mean a lower return since we would be adding costs to the investment.

Question 11: Do you prefer to buy the property from a bank or from a private individual?

If we buy it from a bank, the normal thing is that the price is below the market price, but it is also likely that there will be damage to the property that would have to be renovated, and there may also be greater ease when it comes to negotiating the price depending on the bank's desire to dispose of the property. When buying from a private individual, we ensure that the property is ready to move in since someone lived before buying it, but the price could not be negotiated.

Question 12: Buying with or without real estate?

The advantage of buying with real estate is that you forget all the steps involved in buying a property, but it involves a cost that reduces your profitability if you buy to rent. Not buying through real estate implies a greater number of steps for the investor, more dedication, but on the contrary, it also improves profitability by reducing associated costs.

Question 13: Would you make visits with future tenants personally or with a real estate agency?

Doing them yourself helps you get to know all the potential tenant candidates firsthand, but it takes a lot of time, patience, organization, etc. Doing it through a real estate agency has an added cost, but you can avoid occupancy problems or scams.

Question 14: Do you prefer traditional (long stay), tourist (days or weeks) or room rentals?

Traditional renting is much more passive, normally a tenant spends one, two or three years without moving to another property, which would give you greater peace of mind, and the return is slightly lower than the other options but safer over time. Tourism has a lot of management behind it but with greater profitability. When it comes to renting by room, it involves a lot of management, it has good profitability and tenants stay for a medium-long period.

Results

The truth is that with these questions and different cases, there are many types of investors, but thanks to these different options you can more easily see what type of investor you are.

However, whatever your investor profile, Reental's tokenized properties are a great option. Thanks to real estate tokenization, Reental is able to make investment in real estate safe and profitable for any investor profile. And not just any investor profile, but also any type of person, regardless of their origin, language, capital or currency.

Join Reental to enjoy first-hand real estate investment avoiding all the steps.

In order not to miss any of the opportunities we present, we recommend that you join our group of Discord or Telegram To get to know others Reentels and the whole team. Of course we invite you to take a look at our articles on the blog to continue informing you.

Welcome to the new way of doing finance, welcome to Reental.