Investment markets include the stock market, over-the-counter, gold, coins, and other markets, and investing in construction and the housing market is one of the most reliable and profitable markets. According to studies conducted and various financial market indicators, including important profitability indicators or capital return rates by expert economists, one of the recommended markets is always investing in construction, which can include building construction, participation in construction, villa construction, and work related to property, housing, and land.

What factors are important for choosing the type of investment market?

• Initial capital amount :

One of the influential factors in choosing the type of investment market is the amount of capital we can consider for investment.

• Return on investment :

One of the most important things in choosing the type of capital market is the level of return we expect from the capital we invest in this market.

• Investment period :

One of the factors that affects our profitability in the investment market is the length of time we have invested our capital in this market.

Investing in construction is one of the safest ways to invest.

Types of investments in the housing market

Investing in housing is divided into 6 categories, each with its own unique characteristics. For example, investing in construction requires a lot of patience, while the conditions for buying and selling property and housing are different.

1- Investing in buying and renting housing :

You can achieve sustainable income and profit by buying apartments and residential houses, renting and mortgaging them, and selling them when the price increases.

2- Investment for buying and selling housing :

People who work in the field of buying and selling real estate gradually realize when it is better to buy and when it is appropriate to sell, and they buy a property at a lower price and sell it at a higher price.

3- Buying and constructing shantytowns :

One of the things that has a very good return on investment is buying a dilapidated property, obtaining a demolition permit, renovating it, and building it into new apartments. This is very profitable, but entering this field requires a lot of patience.

4- Buying old properties and renovating them :

Another way to profit in the housing market is to buy old properties and renovate them in a modern way. This will increase the price of the property and make a good profit for the person.

5- Participation in construction :

One of the methods of investment in the field of real estate is participation in construction. In this method, some owners of vacant properties or owners of undeveloped land who want to build their property, but do not have the necessary costs for this, partner with some builders who want to invest in construction, and the partnership share of the parties is determined through the construction participation contract, which is basically about 60 to 40 in favor of the owner. (Of course, it depends on the price of land in that area.)

In a construction partnership contract, each party to the contract has a contribution. The owner’s contribution is the property and land on which construction is to be carried out, and the builder’s contribution is his knowledge and expertise and the total construction costs. During construction and according to the costs incurred by the builder, the owner transfers the builder’s share of the parent deed.

6- Investment in construction :

Investing in construction is also one of the important things in the field of real estate. For this, you can purchase the property and build on it at the same time, or you can sign a management contract with the owners and receive a percentage from the owners as a management contract percentage if you have sufficient knowledge, expertise, and experience in construction.

The right time to invest in the property market

The best time to invest in the housing market is when the housing market is calm and prices have not yet reached their highest levels. Roughly speaking, the housing market is a 4-year market, with a jump in property prices occurring every 4 years. At the beginning of this 4-year period, housing has a rising price but a gentle slope, and in the middle of this period, the price of other investment markets such as gold and coins increases.

After two years, property prices reach a plateau, and at the beginning of the second two-year period, housing prices experience slight increases and decreases, and experienced people buy property at this time. Then, in the real estate market, the difference with the gold and coin market decreases, and at the end of this period, a big jump occurs in the fourth year, and good profits accrue to those who have waited these four years.

Important tips for investing in construction

The construction and sale of apartments has many details, and entering the construction industry is like entering a vast ocean that, blindfolded and without any guidance, entails destruction and drowning. This ocean is often turbulent, and this price instability causes the construction industry to emerge from recession.

How much capital do you want to allocate for construction?

The first important thing in construction investment is the amount of investment you want to make for construction, and you should consider that construction is always full of unforeseen events that you must be prepared for. One of the best ways to prepare for this is to not invest all of your capital in the construction sector. Successful investors in the construction industry are those who keep some of their liquidity aside so that they can fix it if a problem arises.

What are the costs of construction?

1. Land price
2. Required excavation depth and type
3. Concrete or steel frame type
4. Number of floors
5. Costs commensurate with the location of construction and the quality of materials in joinery and reinforcement
6. Labor costs
7. Price fluctuations in the last year or two have had a significant impact on the final price of the building.

Principles of land purchase and how it affects the cost of construction

The total cost of a building is largely related to the price of the land, and the price of the land also depends on its location and location, as well as the city in which the construction takes place. Choosing land for construction is very important, as making a mistake in the selection can cause irreparable damage.

In Tehran, the most expensive land is located in areas 1 to 5, and the cheapest land is located in the central and southern regions of Tehran. In urban planning regulations, 40 to 60 percent of the land area can be considered for building construction and occupancy levels, and the rest of the land is considered as yards and areas.

Density percentage refers to the amount of infrastructure that you can build on the land area occupied. The density and occupancy level are determined based on the detailed urban plan, and the municipality carefully evaluates and controls it, and if it does not comply with the detailed plan, heavy fines will be imposed.

Concrete or steel frame type

In a steel frame, because the entire frame of the floors is implemented after the foundation stage, more liquidity is required to pay for the steel cost for the entire frame of the floors, which is generally received in cash and all at once. But in the concrete skeleton, because this skeleton is implemented gradually, a slower injection of money into the project is also required.

In general, it cannot be said that the strength of a concrete skeleton is greater than that of a steel skeleton, or that a steel skeleton is a more suitable structure. Any building that implements engineering principles and is free of defects will have the necessary strength, whether it has a concrete or steel skeleton.

Carpentry and apartment construction costs

One of the most important items in construction costs is carpentry, which accounts for two-thirds of apartment construction costs. Therefore, the quality and type of materials chosen have a great impact on the price of building an apartment.

Before starting carpentry, knowing the materials is of great importance and has a great impact on the final price and quality of the work. Purchasing building materials should be done in a way that creates the best balance between price and quality. For example, Iranian tiles, which have a special quality, should have a higher priority for purchase compared to foreign brands that are more expensive and of lower quality. Proper understanding of these issues will increase the quality of the building and reduce its final costs. Such knowledge is the result of extensive experience in construction.

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