Which is More Profitable? - page 9. | Bitcointalksearch.org

barisbilgili

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Quote from: Davidvictorson on July 18, 2024, 04:43:44 PM

There has been ongoing debate regarding the best way to recoup the investment made in constructing a residential apartment building. For those involved in real estate, where does the real profit lie? Is it possible to recoup the money spent on constructing a residential apartment building through renting it out, or is selling it a better option for recovering the investment?

I think renting it out or selling it is the same, it all depends on our desire to return the capital, whether we want it quickly or slowly, but there are advantages and disadvantages to each.
We can sell it to get back capital and profits so we can do the same thing in other places to get more profits and renting it out can become our fixed asset for the future and create a fixed asset for ourselves, so that's the same profit we get. It all depends on our individual choices.

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Quote from: Davidvictorson on July 19, 2024, 04:31:33 PM

- if you are building to hand over the property to your kids and their kids then there is no problem putting out the property for rent.
- If you want your investment back in the shortest of time build and sell. You'll get both your investment and profit back and you can move unto your next building project.

As you have been told, both can be profitable. But I would qualify that they have to be profitable, at least on paper, otherwise you are doing something wrong.

As you say, if you sell all the flats what you are doing is recovering the money you owe the bank (because I assume you are going to ask for a mortgage) and the profit faster. If you rent them out you will owe money for longer, you will have more headaches with the tenants but you will have a monthly cash flow and at the same time the property will tend to appreciate in value over the years.

But here is the thing: the builders where I live do it in a mixed way: they sell most of the flats to recover what they owe the bank and make a quick profit but they keep a few flats and above all the commercial ground floor flats to rent them out. That way you can have your cake and eat it too.

maydna

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If they want to make money fast, they can sell it to the potential buyer but that will not easy to find the buyer especially in this situation whereas the economic situation is slow to be better. They can renting out the apartment for some term before they decide to sell it especially if they don't have potential buyer. That will gives them money for some period while they search the buyer who wants to buy the apartment building. That solution can be apply if they difficult to find the buyer and I see some people who have a residential or apartment choose to renting out their property for some time.

That gives them money and recovering the investment although slowly but they can sell it directly when they gets the potential buyer who wants to buy their property.

Mame89

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In fact, both methods can be equally profitable, it just depends on your goals and needs in making decisions. If you really need a lot of profit in a short time, maybe selling some of it could be your choice. However, if you really intend to earn passive income, it is better to rent it out. So it could be said that these two methods can get back the investment funds that you have made in the apartment investment, but it is up to you whether you want it in the long term or in the short term.

Because basically property investment is very profitable, even though the maintenance costs are also large, it is worth it because usually property prices will increase every year. Investing in property can change your future too, especially if you can also invest in bitcoin, that's even better.

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Quote from: Davidvictorson on July 18, 2024, 04:43:44 PM

There has been ongoing debate regarding the best way to recoup the investment made in constructing a residential apartment building. For those involved in real estate, where does the real profit lie? Is it possible to recoup the money spent on constructing a residential apartment building through renting it out, or is selling it a better option for recovering the investment?

Both will recover the future investment returns in time. Having an apartment is a very profitable business, so either you sell it immediately or make it a rental business, both will actually offer you great profits.

Now, the question is if you want the long term process of the faster one. Because if your goal is to create an instant profits so you can proceed to your next investment, then sell the property with a good price. Renting the property will only lengthen and prolong the accumulation of profits.

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Quote from: Rruchi man on July 19, 2024, 10:56:25 AM

Quote from: Davidvictorson on July 18, 2024, 04:43:44 PM

where does the real profit lie? Is it possible to recoup the money spent on constructing a residential apartment building through renting it out, or is selling it a better option for recovering the investment?

What is to be considered is the duration within which the investor in real estate wishes to recoup their investment.

If it is an investor who has invested in real estate and is expecting to get his profit really quickly, then selling off the apartments can be a very good way to do so. But if it's an investor who is seeking a sustainable and continuous stream of income and is not bothered about quick returns, renting for a period of time becomes the most appropriate choice for them.

Exactly, it depends on how the investor itself would want to gain his profits, be it short term or long term. But nevertheless, both are still profitable but it only differs on time. One will make instant profits just by selling the real estate once he finds a good buyer, or if he chose the long term profitability, simply renting it out will serve a better option.

However, if the investor is in need of real quick money, selling the apartment would provide him quick huge returns. As long as he'll find a potential buyer, the transaction will be smooth and fast.

red4slash

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In the country I live in now, there are still many people who do the first option where they build a house and rent it out instead of building for resale at a relatively higher price. Although the second option still exists, if you look at the current conditions in my area, of course more people are building and renting it out because the benefits are much greater. This is a natural thing here because seeing from the price of a place that is still quite cheap and a lot of people who still don't have their own place to live and prefer to rent, making the opportunity to take advantage by renting out a house will clearly become more lucrative.

But of course in this case it depends on where you also live because in the end this will determine which benefits have greater potential to be an option considering that different places or regions must also differ in people's thinking so that this will clearly affect business choices whether building houses for rent or building for resale at higher prices .

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Quote from: Davidvictorson on July 19, 2024, 04:31:33 PM

Quote from: SmartGold01 on July 19, 2024, 04:05:35 AM

Quote from: Davidvictorson on July 18, 2024, 04:43:44 PM

There has been ongoing debate regarding the best way to recoup the investment made in constructing a residential apartment building. For those involved in real estate, where does the real profit lie? Is it possible to recoup the money spent on constructing a residential apartment building through renting it out, or is selling it a better option for recovering the investment?

Now let me just trying my best with my small experience then, let me start with renting; in Renting the profits minimal like it doesn't have a stable and sound profits, reason is that in rentage when you spent a total amount of 50M to construct a building after which placed it on rentage it could cost you a total of 20-30 years to cover the cost spent in that building depending on the amount fixed at annually / Quarterly (Monthly/yearly), maybe it could around 500k per apartment then multiple by total apartment in that building, let say 5 apartment... 500,000 x 5 equal to 2,500,000 per year, then we subject it to the total amount spent in constructing the building.. 50,000,000 / 2,500,000 = 20.

Meaning it would take you 20 years to recover the amount spent in constructing a building with 5 apartment, after which your profits continues and it's a lifetime investment, but this depending on your age. If you are already 50 year old when you have that building, before you recover the amount it could cost you a total of 70 years which you are already weak (50 age + 20 years). So the investment is for your children and not yours.

Now, selling a building, if you spent 50m in that build you may decides to sell it at 70m-100m meaning you made your profits instantly without having to wait for lifetime to recover your profits, and off course you can always construct another building to sell, maybe within 20 years of your life have succeeded making 30m x 20 =600m within 20 years.

In Summary selling a building is more profitable than rentage.
I don't know if this is actually what you mean or not

YES.
My idea is not to make passive income initially. At least you cannot call it passive income until you have recovered all of the money spent on building the apartment. And like most real estate guys have adviced which is the same thing with what you have said, it will take many years to recover your initial investiment in building the apartment if you put it out for rent. Their recommendations are two-folds.

- if you are building to hand over the property to your kids and their kids then there is no problem putting out the property for rent.
- If you want your investment back in the shortest of time build and sell. You'll get both your investment and profit back and you can move unto your next building project.

Now at least you made it clear for us that you prefer more selling than renting it out. I believe we all have different perspectives on that. Selling would give you more satisfaction if your end goal is to make a huge profits on it. But if I were to asked, there's no wrong also with having an apartment for renting as long as you don't need the profits at an earliest time possible, since renting takes a lot of time before you will recover your capital and make consistent and sustainable profits.

Davidvictorson

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Quote from: SmartGold01 on July 19, 2024, 04:05:35 AM

Quote from: Davidvictorson on July 18, 2024, 04:43:44 PM

There has been ongoing debate regarding the best way to recoup the investment made in constructing a residential apartment building. For those involved in real estate, where does the real profit lie? Is it possible to recoup the money spent on constructing a residential apartment building through renting it out, or is selling it a better option for recovering the investment?

Now let me just trying my best with my small experience then, let me start with renting; in Renting the profits minimal like it doesn't have a stable and sound profits, reason is that in rentage when you spent a total amount of 50M to construct a building after which placed it on rentage it could cost you a total of 20-30 years to cover the cost spent in that building depending on the amount fixed at annually / Quarterly (Monthly/yearly), maybe it could around 500k per apartment then multiple by total apartment in that building, let say 5 apartment... 500,000 x 5 equal to 2,500,000 per year, then we subject it to the total amount spent in constructing the building.. 50,000,000 / 2,500,000 = 20.

Meaning it would take you 20 years to recover the amount spent in constructing a building with 5 apartment, after which your profits continues and it's a lifetime investment, but this depending on your age. If you are already 50 year old when you have that building, before you recover the amount it could cost you a total of 70 years which you are already weak (50 age + 20 years). So the investment is for your children and not yours.

Now, selling a building, if you spent 50m in that build you may decides to sell it at 70m-100m meaning you made your profits instantly without having to wait for lifetime to recover your profits, and off course you can always construct another building to sell, maybe within 20 years of your life have succeeded making 30m x 20 =600m within 20 years.

In Summary selling a building is more profitable than rentage.
I don't know if this is actually what you mean or not

YES.
My idea is not to make passive income initially. At least you cannot call it passive income until you have recovered all of the money spent on building the apartment. And like most real estate guys have adviced which is the same thing with what you have said, it will take many years to recover your initial investiment in building the apartment if you put it out for rent. Their recommendations are two-folds.

- if you are building to hand over the property to your kids and their kids then there is no problem putting out the property for rent.
- If you want your investment back in the shortest of time build and sell. You'll get both your investment and profit back and you can move unto your next building project.

Findingnemo

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Quote from: Davidvictorson on July 18, 2024, 04:43:44 PM

There has been ongoing debate regarding the best way to recoup the investment made in constructing a residential apartment building. For those involved in real estate, where does the real profit lie? Is it possible to recoup the money spent on constructing a residential apartment building through renting it out, or is selling it a better option for recovering the investment?

Buy a land, build a residential property and then sell it for x amount looks small but it will take ages and trust me it needs skill and experience to sell especially real estate so if you have been already in the brokerage then you can consider doing it or else just better rent them and make passive income.

Meanwhile both are not great choices as an investor because the growth and ROI is too small compared to stocks or other volatile investment.

Hatchy

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Quote from: Davidvictorson on July 18, 2024, 04:43:44 PM

Is it possible to recoup the money spent on constructing a residential apartment building through renting it out, or is selling it a better option for recovering the investment?

On a norms, both will be profitable it's just like long term and short term trading. Selling of the house would yield you a huge amount more than what it was built with in a short period of time. But then if you rent of the building and hold, it will yield you even more than that which you would have sold off. That because a building can stand for more than 5 years before needing a renovation. And upon renting, you will annually receive rent for that five years giving you a sure and reliable source of income for this period where you don't have to renovate. For me I'll go for rent.

ajiz138

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With the property that has been built, of course it will cost a lot of money after all the residences are completed, the owner will definitely rent out because this is for the sustainability of future profits, if it's a matter of talking about turning capital, of course it takes a few years but after returning the capital back then you will get the benefits of rent that continue to flow every year.

Selling property, of course, you will get your investment capital back faster and can build other businesses because the turnover of money is faster too, it's just that these are two sides that have different benefits, everyone will definitely have that goal.

For me, I would rent rather than sell because that's what we have been thinking about for a long time and we will always get profit every year.

Rruchi man

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Quote from: Davidvictorson on July 18, 2024, 04:43:44 PM

where does the real profit lie? Is it possible to recoup the money spent on constructing a residential apartment building through renting it out, or is selling it a better option for recovering the investment?

What is to be considered is the duration within which the investor in real estate wishes to recoup their investment.

If it is an investor who has invested in real estate and is expecting to get his profit really quickly, then selling off the apartments can be a very good way to do so. But if it's an investor who is seeking a sustainable and continuous stream of income and is not bothered about quick returns, renting for a period of time becomes the most appropriate choice for them.

Questat

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Both can bring decent profits. If you want to have quick and instant profits, selling the property would be the best option, of course with the best price offer. However, if your goal is to establish a passive income for long term, renting the property would certainly give you what you aim for. Although it will also demand higher amount of maintenance, but in the end the passive income you will earn is definitely bigger than its maintenance amount. So it’s certainly a win-win for you.

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Quote from: Davidvictorson on July 18, 2024, 04:43:44 PM

There has been ongoing debate regarding the best way to recoup the investment made in constructing a residential apartment building. For those involved in real estate, where does the real profit lie? Is it possible to recoup the money spent on constructing a residential apartment building through renting it out, or is selling it a better option for recovering the investment?

Selling it will give the most profit out of it because you can lump sum the potential profit so that you can rollover it to the next investment without paying for maintenance cost for the building if you decided to rent it out for apartment.

But other people think for sustainability that’s why many preferred the long shot since they don’t want to take risk anymore for finding another opportunity to acquire or construct new building.

For me selling since I can use the money to other business that will generate more profit.

Samlucky O

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Quote from: Davidvictorson on July 18, 2024, 04:43:44 PM

There has been ongoing debate regarding the best way to recoup the investment made in constructing a residential apartment building. For those involved in real estate, where does the real profit lie? Is it possible to recoup the money spent on constructing a residential apartment building through renting it out, or is selling it a better option for recovering the investment?

Everything lies on you. It's just like trading of bitcoin vs buying bitcoin and HODl. Those who build apartment and sale instantly are like bitcoin traders, while those that built and rent out their apartment for long time are like bitcoin HODLers, so you can answer the questions yourself from my explanation. For me I prefer building and renting it out as a form of business to generate a passive income or annual income and it can be invested in bitcoin as lump sum annually and it becomes you retirement savings. One important thing you should know is that not everyone that has money to build house and sell to recoup their Money, although according to your statement It talk about those who are into real estate and such is only for multi millionaire and not for all. If such person has that amount to build and sell it's fine, but if he doesn't have that much, he can just build for rent to recoup his money.

Darker45

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Basically, it's more profitable to rent it out. But the ROI will only start flowing in after several years. If you include the piece of land, it will take more years for you to start receiving returns. However, that's going to be passive and steady income. If you prefer money that you don't work for day in and day out and continuously every month, it's the better choice. This is my cup of tea.

Selling is one time. You won't get regular profit from it. But if you prefer quick profit, it's going to be the better choice. Let's say you build an apartment for 6 months, you can get back everything that you spent plus a nice profit as quickly as the 7th month. But there's no more profit after that. I don't like this.

There's going to be a third option, better than the other two, the kind of business that some of the richest in my country are involved in. It's constantly rolling the money. You build and sell and use the money to build again and then sell and then look for another land to build on and sell again and so on. That requires commitment, however. It involves bigger tasks. This isn't the kind of business that a lazy man like me wants.

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Quote from: Davidvictorson on July 18, 2024, 04:43:44 PM

There has been ongoing debate regarding the best way to recoup the investment made in constructing a residential apartment building. For those involved in real estate, where does the real profit lie? Is it possible to recoup the money spent on constructing a residential apartment building through renting it out, or is selling it a better option for recovering the investment?

That will depend on you, if you want to recover capital quickly and have another business idea, selling is the solution, but if you want to create a passive income source, renting is the choice.

If it were me, I would lean towards generating passive income by renting as it will be beneficial in the long run as you can both increase your income and increase the value of your real estate over time. Not to mention buying real estate with a good location is not easy, so you need to consider carefully before selling. Selling real estate is easy, but buying land with a similar geographical location or potential is not easy.

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Quote from: Vod on July 18, 2024, 09:17:47 PM

You can always make more money renting than selling. After all, you are providing a service. If you are not interested in dealing with tenants, you can hire a rental agency to take care of everything for you.

I agree, 100%.
While it looks like someone is able to make a profit margin from selling it. But it's not always easy to dispose a property and have your margins, location is still the biggest factor there. And with that case, you look at the real estate moguls, they're not going to sell their properties if they're in the prime location. They make their properties as their personal slave and make their money for them and for the next generation of their families.

With the apps like airbnb today and any other similar services, you're not going to be problematic with the clients. All you have to do is just be active on every platforms where you can post that property or apartment of yours. I've got friends that even bought units and apartments and have it rented through airbnb. This is how you earn while sleeping as W.Buffett said.

GeorgeJohn

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Quote from: Davidvictorson on July 18, 2024, 04:43:44 PM

There has been ongoing debate regarding the best way to recoup the investment made in constructing a residential apartment building. For those involved in real estate, where does the real profit lie? Is it possible to recoup the money spent on constructing a residential apartment building through renting it out, or is selling it a better option for recovering the investment?

A real estate management have different ways of making or recovering any money they spent for real estate, sometimes they purchase their landed property at affordable prices and if they decide not to build any structure in that particular land they will create roads and start selling the lands at high price, secondly if they build structure like houses in their real estate they can decide to sell the houses apartment by apartment, but only ways I know that real estate make profit is by selling of land instead of building houses for rents.

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