Investments
Three filters before considering an investment apartment
Micro-location, true cost and a realistic exit: a concise framework for better initial screening.
An investment apartment should not be assessed only by its purchase price or a theoretical yield. Decision quality depends on how realistically demand, total cost and the future exit are examined.
The first filter is micro-location. Access to transport, universities, employment, services and daily necessities affects vacancy periods and the profile of potential tenants.
The second filter is the true capital required. In addition to price, the calculation should include taxes, transfer costs, professional fees, renovation, furnishing, time without income and a reasonable maintenance reserve.
The third filter is the exit. A property with a narrow audience or an inefficient layout may generate attractive income today but be harder to resell tomorrow.
Returns should be tested under base, positive and negative scenarios. Lower rent, a vacancy period or an unexpected expense should be absorbable without undermining the investment thesis.