Of the recent land disputes, many cases have fallen into the investment category in the form of capital contribution, investment cooperation or investment agreement.
In order to limit the risk of investing in real estate through capital contribution, investors should note the following 5 things.
Note the first capital contribution of land
Do not contribute capital to housing products that are legally problematic. Accordingly, when the buyer signed a contract of capital contribution, the buyer has the right to request the investor to provide complete legal documents of the project. In addition, the buyer should also spend time to inquire and thoroughly inquire the investor all information related to housing products as well as procedures for legal proceedings. It is important to note that the project investor must be transparent of all possible scenarios.
A key factor for buyers to decide whether to pursue this investment is the legal completion time of the project. Listing the project implementation (including project progress) will help buyers have a clear road map for cash flow preparation, taking into account the risks and the possible risks.
Note these 5 to avoid losing money when making investments in housing
Note the second capital contribution of housing
Do not put too much of a terrible profit expectation. A golden rule when investing in real estate is that the higher the profit, the greater the risk. Therefore, cheap products often have some problems or hidden something, the more attractive the product should be cautious.
Note the third contribution of capital investment housing
Read the terms of compensation carefully. Compared with sales contracts, the commitment in the capital contribution contract is often not as high, only at the symbolic level and the return on capital, even the highest risk is no compensation. Therefore, the buyer should carefully read the terms of compensation and ask the investor to explain the specific words. If you find anything unusual, the buyer should ask the investor to adjust or negotiate the level of compensation more reasonable, avoid losses on his side.
Note the fourth contribution of capital investment housing
Have a backup plan. For capital contributions, if the buyer believes fully and pours out his plan A, the buyer is likely to suffer heavy losses if the plan fails. Therefore, the buyer should prepare a plan B to prevent the return when the force majeure condition occurs. To ensure the safety of capital investments, it is important to be prepared for failure.
Note the fifth contribution of capital investment housing
Sign with reputable investors. Buyers should sign contracts with well-known owners and brands on the market. For a new owner, he or she should thoroughly understand the historical information and business process of the business. For those who have been involved in legal scandals, buyers should question their credibility. Or, if you are more careful, you may want to consult with industry experts before making a down payment. Refer to 4 steps to determine the credibility of investors.
Additional notes: Characteristics to determine investor credit when buying a home
The reputation of the owner is a qualitative rather than quantitative one. On the market today most of the prestige assessment of investors based on the fact that the investor has implemented as well as business principles of the head of the business, but that is not enough. In order to best determine the owner’s credibility, in addition to the 4 steps that Realestatevietnammentioned above, you need to pay attention to the following characteristics:
The progress of the project and the commitment of the investors in the implementation process such as construction contractors, lending banks.
Evaluate the owner through the operation and management of the project after delivery to the residents.
Based on the opinions of the previous buyers and residents of the project as the basis to determine the reputation of the investor.
Ask their direct buyer / partner to work directly with them. Ask as many people, the more consistent the answer, the higher the accuracy. However, you need to pay attention to the questions and answers so as to ensure objectivity. You should ask people you know and trust if you can.
Verify the assessments of the referenced people by directly surveying the project, contacting their staff, and then making a self-assessment accurately.
Buyers need time to explore and investigate, which in the investment or called “due diligence” – is a comprehensive survey. Do not be lazy and make excuses for less time, as you may have to pay a price for your mistakes.
There should be real visits to the projects of the investor you are interested in.
Contact the companies specializing in distributing projects for more information.
You are following article 5 of this note to avoid losing money when making a home equity investment in the Realestatevietnam Guide. In order to calculate the flow of capital when capital adequacy is not buried, you can refer to the following bank interest spreadsheet for liquidity.
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