The purchase of a property, whether it is a primary residence or an investment property, is one of the most important financial decisions an individual will make.
property, is one of the most important financial decisions an individual will make in his or her lifetime.
in his or her lifetime. It can be a daunting experience for some. It is a process that
takes time. However, when you work with the right broker and are properly educated about the process, it can be quite simple.
educated about the process, it can be quite simple.
Through our website, we explore the in-depth process of buying investment property in Asuncion, a market in which we have a large
investment property in Asuncion, a market in which we have extensive experience in helping people
experience in helping people from all over the world to buy rental properties. It is
our goal to educate about the investment process and make it easier to understand.
to understand. To that end, we have prepared this comprehensive guide to real estate investment in Asunción, and we are available to answer any questions you may have.
Asuncion, and we are available to answer any questions you may have along the way.
In the process, time management is essential, the first aspect is to take the right amount of time in the search
time in the search in order to detect opportunities together with the real estate agent.
opportunities. And again, once you have found the optimal investment, move quickly to make a
making a deposit to separate it from the market and not lose it.
Once you find the property that best suits your needs, we will take the transaction through the closing process
the transaction through to the closing process, ensuring that the legal aspects of the transaction move through
the transaction move smoothly to complete the purchase. In parallel to these
we will plan together with the investor the adjustments that need to be made to the property, requesting quotations and
property, requesting quotations and offering the rental. In this guide, you will find
useful information and a proven step-by-step process to take the guesswork out of your investment search.
Sobre Nosotros
Asunción Investments and Administrations is a professional boutique real estate agency professional real estate company, specialised in investments and their management. With a clear knowledge of clear knowledge of the market prices of finished units and their rental potential, we rental potential, we provide honest honest advice, valuing the long-term long-term relationship with our investors. investors. We help people from around the world to make sound investments in the city of Asunción.
In this Guide to Real Estate Investment in Asuncion, you will find useful information and a information and a step-by-step, tried-and-tested buying process to take the guesswork out of guesswork and find the property or portfolio that best suits your investment profile.
STEP 1
PARTNER WITH A BUYING AGENT
To make the best possible real estate investment decision, you need to have the best possible representation, which means having your own investment agent working on your behalf. In any real estate transaction, there will be a seller's agent representing the seller's interests. Likewise, with a buyer's agent, you have someone who is dedicated to your interests. Working with a buyer's agent has no cost of commissions for the investor, since in Asuncion the seller always pays the commission.
One of the most important aspects of a buyer's agent is that he or she has no vested interest in a specific property.
specific property. The listing agent, on the other hand, has a vested interest in selling the apartment or building that he or she has
for sale.
Some points on which an investment agent might have a different opinion than a sales agent:
* The value and ease of resale of the property upon completion of construction.
* The potential rental value of the property, subject to reasonable vacancy conditions.
* The actual net value that the investor will obtain after all deductions for gross rent have been made.
* The additional costs that the property would represent to place on the rental market.
* How the property will be positioned in relation to its competition for rent.
Think of it this way: If you were the defendant in a trial, you would not use the plaintiff's lawyer to represent you. The
Same situation here. Be smart! Use your own broker.
Other tips on hiring an agent:
* Don't use multiple agents, as none will be fully committed to helping you.
* Engage with a professional agent, tell them, and they will bend over backwards to find you the best property.
* A good agent will be able to get you in to see all the flats available on the market, including some that are not yet listed.
* An agent with whom you team up with will have the patience to look for the best alternative and will not always be always rushing you to sign.
STEP 2
Initial interview with investment agent: General aspects of investing in Paraguay, defining the objectives of the investment portfolio, type and areas of property to be acquired.
En esta primera entrevista se busca que el inversor comprenda mejor los aspectos jurídicos, economic and market aspects of Paraguay.
Before beginning the search, the buyer should understand the different types of investments that are available. that are available.
There are four types of ownership:
* Residential and corporate developments in the pipeline.
* Inmuebles terminados o próximos, con pago contado.
* Inmuebles terminados o próximos, con posibilidad de financiación.
* Finished properties already with tenant, cash payment.
In turn, we have three focal points of rental demand:
* Shopping del Sol
* Villa Morra
* Historic Centre
With these general aspects clarified, the investor together with the agent will be able to determine what their flow of funds would be to make the investment as well as their time expectation to receive the investment.
would be their flow of funds to make the investment as well as their time expectation to perceive
return flow. We usually work with both single-property investors and multi-property portfolios.
portfolios of several properties. In some cases they are simple cash transactions with immediate income and in others they are
with immediate income and in other cases we combine cash purchases with other well purchases to maximise a medium term income.
Related resources:
“Investment Stories”
“Rental demand hotspots in Asunción”
STEP 3
CREATE A WISH LIST
Now it's time to make a wish list of what you want in a property. Do you want to
Do you want to be in an up-and-coming location, or one that is very established? Do you want a premiun development on an
on an avenue or something smaller on a cobbled street? The answers to
these questions will help your investment agent understand which properties might be a good fit for your tastes, and which ones might be a
suit your tastes, and which might not.
It is also important that you understand what is just a wish and what is non-negotiable. You can
expect to find a building with a pool or terrace, but you would settle for something without it. On the other hand, you may
On the other hand, you may value high or low floors differently. Being clear about your expectations will
and your agent to broaden your search and find properties that would otherwise be missed.
STEP 4
SEARCH FOR PROPERTIES ONLINE
With your wish list in hand, and the idea of the investment portfolio you intend to build, you can start looking for properties online.
you can start looking for properties online. Start with the Asunción website
Inversiones y Administraciones Inmobiliarias, which offers powerful features to help you find your ideal investment.
find your ideal investment. We have access to all of Asunción's developments. If you want to
search for yourself
click here.
Most of our clients prefer us to suggest interesting investment alternatives to them.
interesting. If you would like us to prepare a tailor-made property search for you, please click
and with your commitment to work together, we will prepare results for you based on your unique parameters.
Note: We may not present you with some ventures that have come to your attention and look "very interesting", we have our own
and look "very interesting", we have our own filter in terms of developers' track records, track records and delivery
developers, track record of meeting deadlines and quality of delivery so we omit to offer them.
from offering them. It is important that you consult with your investment broker on any alternatives
for an honest and thorough appraisal in the process.
STEP 5
INDIVIDUAL AND COMBINED CASH FLOW COMPARISON SPREADSHEETS
Once we have made a pre-selection of properties, we will dump them into an excel spreadsheet where we will be able to see the basic aspects of each one as well as their gross and net profitability.
where we will be able to see the basic aspects of each one as well as their gross and net profitability
and their form of payment.
In the case of investment portfolios that seek to maximise an amount of future income, we typically
We usually put together the estimated cash flows of the real estate portfolio to see their best combination.
“How to calculate the pocket profitability of real estate”
STEP 6
VISIT PROPERTIES WITH YOUR AGENT, Physically or Virtually!
Now for the fun part: the property visits! Once we have a short list of properties to visit
properties to visit, with an estimated cash flow that we will put together for you,
we will set up individual appointments to view properties in person or via video call.
In a short time, you will narrow down your selection and we will have a few properties to choose from.
If you do your own property search, do not call a property agent directly if you are working with an investment agent.
if you are working with an investment agent. Remember that sales agents work for the seller, not you!
the seller, not you! If you are shown the property, the listing agent will expect to represent you.
represent you. You will enter into "dual agency", forfeiting your right to undivided loyalty.
STEP 7
DISTILL A BID PRICE
For the properties you select, and based on our experience with that type of property or even with those same sellers, we will or even with those same sellers we will develop negotiation tactics to get the best possible deal for you as an get the best possible deal for you as an investor.
We have closed sales data from neighbouring flats in buildings with similar characteristics.
similar characteristics. From all these data and market information, we will distil
an opening bid price.
STEP 8
MAKE AN OFFER AND NEGOTIATE
In Asunción, offers can be made orally or in writing through the buyer's real estate agent.
of the buyer. Oral offers are usually not taken as seriously by sellers and therefore rarely help to obtain the best possible price.
therefore rarely help to obtain the best possible price. Only written offers,
accompanied by a deposit, usually around 2% or 3% of the amount of the property, and with a quick turnaround time, generate this feeling.
the seller the feeling of having to give more, but to conclude the deal.
to conclude the deal. In addition, the written document already contains other points which should be made be made clear from the outset, such as: the deed costs of each party,
equipment with which the property is to be handed over, term and form of payment, place of payment, assignment of rental contracts, etc.
The seller usually responds with a counteroffer on the price or on any of the points raised. raised. The buyer and seller will go back and forth until they reach agreement on the final purchase price and any special terms of the deal. price and any special terms of the deal, which will be reflected in the acceptance of the written offer submitted, with the acceptance of the written offer submitted, with any comments both parties have agreed.
STEP 9
NOTARY AND CONTRACT
When acquiring a brand new or relatively new property, we may find that the property has not yet been subdivided and therefore does not has not yet been subdivided and therefore does not have its own cadastral account. By two situations may arise in this regard:
1. That the property has a title deed:
In this case we will designate a notary of confidence of the buyer who will make the request of
report of ownership of the property and inhibition of the signatories, the process usually takes, out of pandemic, about 30 days.
pandemic, about 30 days, at the present time the terms are more variable. Such a deed usually
cost around 2% of the value of the property and is absorbed in the case of brand new properties by the buyer, and in used properties 1% of the value of the property.
by the buyer and in used properties 1% by each party. Although each negotiation can be particular.
2. That the subdivision is not yet completed:
This is primarily found in new and recently completed developments, although it is a highly variable aspect from one development to another.
is highly variable from one development to another. There are cases in which the subdivision is already
completed before the building is finished, others at completion, others a year later and some 2 or 3 years later.
3 years later. Without delving too deeply into the processes or reasons for these variations in timeframes
we can mention that in general, developments with a large proportion of local buyers tend to obtain individualised deeds quickly.
individualised title deeds are usually obtained quickly, as the mortgage disbursements are made against them.
disbursements of mortgages are made against them; when they are developments aimed at foreign buyers, this may not be carried out
foreign buyers this may not happen as quickly, although there are exceptions. In real estate we usually know the status of the previous buildings realised by each developer and can know what to expect in this respect. developer and we can know what to expect in this respect.
If we do not have the title deed, a contract of sale is drawn up with notarised signatures, where the seller assigns his original contract to the buyer. certified before a notary, where the seller assigns his original purchase contract to the buyer.
purchase contract. It is of vital legal certainty that the developer of the project gives his consent to the transaction, as he becomes the owner of the property. to the transaction, as he becomes the non-interested party who endorses the transaction. In this case, where this is the case, the transactions can be carried out with the consent of the developer. is the case, transactions can be completed in much shorter timeframes, typically within 10 days.
STEP 10
POSSESSION AND RENTAL
Once we have the key, we will have previously designed and quoted for the necessary equipment or
necessary equipment or improvements to the property to bring it to its maximum potential. At
some cases it may not need anything, although in others it may need detailed furnishing.
furnishings. Once we have the key, every free day counts, so we will have to get down to work quickly to order the
work quickly to order the work or furniture, normally in less than 15 days it should be ready and photographed.
days it should be ready and photographed, and many times we will be able to promote it in the portals before this date.
before this date. In our experience we usually find the tenant less than 30 days after the property is
the property is purchased. From that point onwards, you will receive monthly
monthly settlements of each property as well as your statement of account in the real estate agency, without the need to worry about anything.
no need to worry about anything, that's what we are there for!
“10 Frequently Asked Questions about property management”