What are the factors to consider if you want to purchase an investment property in Yerevan?

Buying real estate is a significant and responsible step, especially for investment purposes. It's necessary to clearly assess how justified the investment is. Now, let's outline some tips on the circumstances that should be considered when investing in real estate.

Property location and related amenities 

Whether you are looking for a property for personal residence or rental purposes, it's important to assess not only the building's location but also the surrounding amenities. It’s important for a property to have access to shops, pharmacies, schools, kindergartens, and public transport. All these will make life many times easier and enhance the value of the property even if someday you decide to rent it out.

In this context, the most suitable choice is the center of Yerevan, due to its infrastructures of state significance, cultural and entertainment venues, as well as business centers. These factors indicate that the city center offers the most advantageous option for investing in property.

Real estate condition 

Make sure to pay attention to the condition of the real estate, including whether it has repairs and the quality of those renovations. If you plan to make significant renovations after purchase, it’ll be more cost effective if you do so to a property that is in need of repair. On the other hand, if you prefer to avoid renovation expenses, purchasing a renovated property in good condition, although at a slightly higher price, can save you money over several years. 

Aside from the property’s condition, you also need to consider the condition of the building and surrounding amenities. Even if your chosen property is in a good condition, its value could be affected if the overall building or neighboring structures are old or deteriorating. This factor can impact the property's rental or resale value negatively.

Property’s legal status

Ensure that the property has all the necessary documentation, including building permits and title deeds. It's important to check whether there are any legal issues or if the property is undergoing foreclosure proceedings. If it’s difficult for you to conduct these on your own, then  seek assistance from legal professionals specializing in real estate matters.

Current property value, potential inflation and yield

It is important to take into account the current value of the property and evaluate its potential of increase in the future. It’s better to choose properties that are located in areas where there is development of republican significance, entertainment, commercial, and business centers. Real estate in such areas is likely to increase in value in the near future, thus enhancing profitability.

If a certain type or location of property is predicted to increase in value over time, then you can purchase it with no doubt. In addition to forecasting inflation, try to estimate potential income, if you decide to rent out or sell your property. 

Estimated expenses

The expenses are not only limited with purchase of the property. Apart from the property's value and transaction fees, there might be repair or furnishing expenses required before renting or reselling it. Therefore, before purchasing the property, thoroughly investigate potential additional expenses after acquiring the property and make sure that they align with your financial projections. Additional costs include property taxes, utility bills, insurance, and etc.

Do you have the necessary money, or do you require financing? 

The funds needed for purchasing a real estate are not always readily available. If such happens, before proceeding with the property purchase, explore mortgage lending or other financing and co-financing alternatives, assessing whether these options align with your financial situation.

Market and competition 

When purchasing an investment property, ensure that what you are acquiring is competitive and in demand. Do a  comprehensive research of the real estate market in your target area before making the deal. Also, study the value of similar properties and analyze the offer thoroughly. If it’s hard for you to research the market and draw conclusions on your own, then seek assistance from the experts in the field.

The past and the future of the property

It’s also necessary to explore the number of previous owners of the property and their reasons for selling (maybe it was profitable, there were legal complications, etc.). Inquire about future plans for the property or the neighborhood; whether or not new buildings or public facilities are planned for construction in the near future.

Conclusion

These key questions, when addressed, facilitate the process of navigating and making the right decision when purchasing investment real estate. If it’s complicated for you to investigate the issue on your own, we advise you to seek assistance from experienced professionals in the field, ensuring that your investments are secure and effective.