The real estate market is one of the most changing, affected by situations such as inflation. The demand for tourism services, infrastructure, nearshoring, among other sectors, have been key in the growth of investments in different sectors. Payment schemes play a key role in boosting sales and transmitting confidence to buyers.
Today on the CREA blog we will explore flexible financing as the future of payment schemes for real estate investors.
What is flexible financing and why is it important?
Flexible financing is a growing trend that consists of adapting payment schemes to the needs of investors and an increasingly dynamic market.
Its importance lies in factors such as:
- Accessibility to offer payment options, which expands the market and allows more investors to access properties.
- Adaptability to the conditions of investors to facilitate the acquisition of properties.
- Flexibility to adjust to a changing market to give buyers greater security.
Examples of flexible financing
There are different types of financing that are flexible and accessible to different investors, such as:
- Deferred payments. Payment scheme that allows the debt to be divided into monthly installments for a defined period to make it more comfortable for the investor.
- Staggered payments. It is a payment scheme in which the installments increase gradually, as if it were a staircase, to settle the debt within a defined period.
- Collective financing. Also known as real estate crowdfunding, it is an investment modality in which different investors provide capital for a real estate project, which reduces the initial investment.
- Lease with option to buy. Also known as real estate leasing, it is a modality in which the buyer leases the property initially, with the option to buy it in the future. In this way, rent payments become financing, without having to apply for a mortgage loan and with the advantage of making a direct negotiation with the owner regarding payment terms.
- Financing with cryptocurrencies. Although payment through cryptocurrencies is a growing modality, it is an option that will revolutionize the real estate market by allowing payments with digital assets, eliminating intermediaries and speeding up transactions. In these cases, properties are divided into tokens to be bought and sold on cryptocurrency platforms to diversify investors.
- Real estate crowdlending. It is a method in which a multitude of individual investors contribute small amounts through online platforms to obtain the capital necessary to finance large projects that previously could only be financed by banks. In exchange, in crowdlending investors can obtain returns if the project is successful, although the return on investment is not guaranteed.
How to implement these payment schemes?
To successfully implement flexible payment schemes, real estate developers must assess payment needs and capabilities to adapt contracts to different situations.
On the other hand, digital platforms and data analysis tools facilitate the management of payment schemes and allow for the creation of customized financial solutions to adapt to customer requirements.
Benefits of flexible payment schemes in the real estate sector
Implementing flexible payment schemes has many advantages for real estate developers, such as:
Increasing competitiveness
Real estate companies that offer innovative, attractive payment schemes that allow them to expand the base of potential clients with different financial profiles, eliminating the main obstacle to investment: the difficulty in raising such high amounts for the purchase.
Improving the customer experience
By offering alternatives such as leasing or crowdfunding systems, clients and investors have more financing options, which increases competitiveness, the attractiveness of the real estate company and the customer experience.
Speed in the sales process
Flexible payment schemes can reduce the time taken to make a purchase decision because clients do not need to raise the full amount for the investment. For example, with a deferred payment system, clients can make payments as the work progresses, allowing the developer to have liquidity to finance its construction.
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At CREA we are experts in making our clients’ real estate investments grow. We offer services such as feasibility studies, real estate appraisals, specialized consulting in the industrial sectors, shopping centers, hotels, macro projects, mixed uses, among other large-scale projects.
