demand for such property
Buy, repair, sell: how to make money on redevelopment in Europe
Rental rates for rental businesses in Europe have been falling for the past few years. According to a PwC study, Emerging Trends in Real Estate, in the eurozone, they dropped from an average of 6% in 2009 to less than 4% in 2017. Many investors have switched to redevelopment projects (they are also called value added projects), with which you can earn 10–20% per annum on invested capital.
The essence of such projects is that an investor or a group of investors acquire real estate in poor condition below market value, repair or rebuild the object and lease it or resell it to end customers at an elevated price. Continue reading
Four largest banks in Greece successfully passed the ECB stress test
On May 5, the European Central Bank (ECB) published the results of the stress test of the four largest banks in Greece: with an unfavorable scenario, in the next three years their capital will fall no less than the minimum requirements of the ECB, which indicates the successful completion of a multi-year restructuring period.
To assess the state of banks, the ECB uses the coefficient of basic capital of the first level (Common Equity Tier 1, CET1) – this capital must be sufficient to cover possible unexpected losses of the bank in case of recession, low interest rates, currency weakening and falling real estate prices. The ECB is considering two scenarios: in the baseline scenario, the ratio should fall not lower than 8%, while unfavorable – 5.5%. Continue reading
Who should not invest in mini-hotels
In Tranio, investors are often asked to find a hotel for 10–30 rooms abroad managed by a large hotel operator and with a long-term contract. However, they do not plan to move and participate in the management of the hotel, but want to receive a guaranteed income.
It is impossible to find such an object for two reasons: Continue reading
