After a long period of uncertainty, now is the ideal time to invest in flourishing industries. According to ECLAC's Report on Investment in Latin America and the Caribbean, "the United Nations Conference on Trade and Development (UNCTAD) expects to see an increase between 10 percent and 15 percent in foreign direct investment (FDI) over the next two years" within the region.
Real estate consulting firm CBRE Mexico indicates that factors such as e-commerce and automation in manufacturing processes within the USMCA are generating great opportunities for the Mexican economy, which is expected to see a stable recovery by the second half of 2022.
These facts show a favorable outlook for the reactivation and creation of prosperous businesses in the medium and long term. However, some sectors seem to stand out more than others due to their own market conditions. Real estate is one of the most attractive industries to invest in. These are some of the most important reasons why:
Despite the economic contraction, the real estate market in Mexico has been one of the most resilient and adaptable. An example of this is recent data from the Federal Mortgage Society (SHF) regarding housing prices, which show an upward variation of around 7.1 percent in the cost of properties purchased. This demonstrates that even in adverse conditions, property prices are unlikely to collapse. In fact, quite the opposite; in 2018, the housing sector contributed to 6 percent of national GDP.
This establishes the real estate market’s reliability regarding future investments. Now more than ever, owning property is a window of opportunity to start doing business.
Technology Is Transforming the Real Estate Industry
Innovation and technological development is catapulting positive transformations in real estate. For example, the rise of proptech facilitates business transactions by making it possible for investors to take a virtual tour of a property, contact a real estate agent via chat, or receive answers to frequently asked questions from chatbots. Through data analysis, realtors can assess an area’s real estate value and determine where and how to develop new housing projects. These technological advances add greater value to both property owners and tenants by providing greater investment certainty and reducing property closing times.
Casai recognizes the value of innovation. We leverage technology in every aspect of our product to provide a unique guest experience that has earned our company five-star ratings. Through our proprietary tech, guests have contactless check-in for a smooth arrival experience and can control every aspect of their apartment’s home tech. Our digital concierge service is available 24/7 to address any concerns, streamlining communications. We have also brought our entire leasing and property renovation process online, reducing unit launch times and making them available for guests in record time.
New Trends and Business Models Are Emerging
New trends and lifestyles, such as digital nomads, “bleisure” travel, and working from anywhere, are changing the paradigm of travel, particularly in Latin American destinations like Mexico and Brazil. This has created a new persona that I call the lifestyle traveler, a group of individuals who seek a heightened travel experience characterized by comfort and flexibility. They prefer to stay in apartment rentals with homelike amenities over traditional hotels. This industry shift translates into new real estate opportunities that previously didn’t exist.
To accommodate market needs, Casai’s supply business model offers real estate investors, developers, and landlords the invaluable opportunity to lease their property as apartment rentals. This effort encourages fruitful partnerships between business tenants like Casai and real estate players. It also aims to meet the increasing demand for short-term rentals. As the lifestyle traveler segment grows, more people will live, work, and travel on the go, consuming local products and driving economic growth and recovery.
With the rise of new hospitality trends and real estate technology and investment opportunities, 2022 is the ideal time to look at this industry for new capital gains. If there is anything we have learned over the past year, it is that a good investment made at the right time can help you navigate uncertain times. Are you ready to invest in real estate?