Profitable residential real estate - while the premium segment

08.10.2010 12:40
Articles about real estate | Profitable residential real estate - while the premium segment A key task is to return on real estate development, and no matter in what segment. There is a market, unmet need, as a consequence - the demand, the ability to create an additional intangible component, the resources - must be the first in the chain, to declare the rules of the game that will set the tone and be a leader in profitable emerging market segment of residential real estate.

Today the real estate market of Ukraine copies developed countries, which passed the stage of formation and develop according to market rules. It makes the market postulate - demand creates supply, my task as a developer - to detect the demand and create a proposal on the market.

Related article: The crisis has created a new format of residential complexes

That today the market offers a lucrative segment of the residential real estate? Nothing, I do not think the competitive environment of the private landlord. Because the system is able to take a profitable real estate niche of premium by the value system that forms the premium class, the demand thereof by the target audience.

Today, in order to implement development project profitable real estate, need to understand its format, location, internal and external space, consumers and the rental price. Knowing the timing of the project, we can see how he answers our conception of the timing of repayment and cash flow that will be formed later.

Capital - this is the image of the whole of Ukraine, its financial center. All new and original projects with a profitable real estate start their story is from the capital.

Below are excerpts from a new analysis for the Kiev-class residential real estate. The article presents data on the zoning of Kiev, which differ from those commonly used.

The next block, I propose a formula for the apartments of various zones of Kiev. Behind it, we consider the difference in the areas of apartment depending on the zone location, pricing, and we summarize the conclusion that the payback period of three zones in months.

Historically, Kiev divide into three premium zones (A, AA, AAA) - in descending order - as the priority and value.

Zoning Kiev

Each zone corresponds to the rule "3x3". Three geography - three formulas apartments - three areas - three cost kvadradny meter rent. Since the market is not pricing - it modeled, based on data from sales, rentals and requests.

In this model, we consider three types of apartments.


• A - 1 bedroom 1 bathroom (one bedroom)

• B - 2 bedrooms 2 bathrooms (two bedroom)

• C - 3 bedrooms 3 bathrooms (Four)

In the central districts of Kyiv housing supply with the characteristics of the economy shall be at a higher cost, at the same time, high-quality sites with premium performance is missing. In this case, developer, developing proet takes into account several characteristics of interior, exterior, service, private security and character. In each of the locations has its own market capacity. The data below are formed according to the analytical studies.

The area of apartments in the premium segment is formed on the basis of analysis of sales, projects and trends. I note that the proposals are not so much as it seems. Plus, of course, an analysis of what is present in markets in countries that already have well-formed parameters profitable housing.

Proportion of areas in each of the locations corresponds to the demand and availability of the target audience.

As for pricing, then this tool will also be given in relative shares. I want to remind you that all the tools are meaningful in determining the optimal variant of relations between the parameters for the planned return. The actual numbers of rent equal to the average readings in these locations.

Now, given the cost items in time, on the one hand, and income on the other, we can speak about the effectiveness of the project. For all three positions of the total area of the apartment building is the same. The costs of construction, decoration, furnishing different for each of the three options.

In order to optimize the data return and payback, we use all available tools: the acquisition of land or renovation of houses, construction technology and materials used, the effective cost of borrowed money ... value of their own or someone else's management company.

As for competitors profitable real estate in the first place, it's Property Types 4 and 5 *, private apartments, which correspond to the premium class and apartments in the same class, offered for sale.
Andrei Kudrin, founder Kudrin Development "
Content tags: Development Housing
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