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Capital market or real estate? Real estate - the venture that combines all the benefits

What are the advantages of investing in the capital market, compared to investing in real estate? To answer this interesting issue, which attracts many Israelis, we collected 5 points for comparison and found Real Estate - a special venture that connects the best of all worlds

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• Yossi Barak

• Barak Finance Group

• Nadelhun

In collaboration with the Real Estate Center

Tuesday, May 11, 2021, 09:00 Updated: Wednesday, May 12, 2021, 08:22

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Many Israelis who invest in the capital market or hold a vacant amount of money, are debating whether it is worth "jumping on the real estate bandwagon" by buying an apartment for investment. When comparing a financial transaction in the capital market and buying an investment property, each side has clear advantages and no less clear disadvantages. To illustrate this, we collected five points for comparison, and found a venture that combines all the benefits of investing in real estate and the capital market in one place.

For those who invest in the capital market and want to diversify their exposure to residential real estate, or hold a sum of money and strive to enjoy the rise in housing prices, buying an apartment and renting it has so far been the only solution. The deal and caused concerns among the private investor.

Taxation of real estate, mortgage and real estate professionals' costs, as opposed to capital gains tax in the capital market

Buying an apartment includes various and high costs and one of the barriers to real estate investing is the high equity. When buying an apartment for investment, the investor is required to bring financing of 50% of the value of the property / transaction. Payment to professionals such as a lawyer, appraiser, realtor and renovator, and high taxation imposed at the time of purchase (purchase tax) and sale (appreciation tax). In the case of purchasing an apartment "on paper", the cost of growth is added to the construction input index. these significantly reduce the resulting net income housing maintenance.

investing in the capital market, however, the costs include the management fee / success fee of body run your investment, as well as capital gains tax ranging from 15% to 25%, depending on the type of investment. investment In the capital market the investor is not required to complete financing and has no financing costs.

Every type of investment has its pros and cons, but how do you combine all the good in one place?

(Photo: Imaging)

Bureaucracy and potential barriers in real estate, in the face of immediate availability in the capital market A

deal to buy an apartment includes a lot of bureaucracy, submitting forms and approvals, declarations to the tax authorities and potential obstacles along the way. Any of these cases can hurt the viability of the deal and even bring it

down.The capital market, on the other hand, offers almost immediate availability for investment.All you have to do is choose the platform through which you make the investment, transfer the money, and your investment starts working.Of course in both cases The investor is required to be highly involved in locating the right transaction and dealing with entities and professionals.Conduct

with tenants and professionals in apartment maintenance, with volatile income in the capital market

Renting an apartment requires ongoing dealing with tenants and costs of repairs and maintenance, which creates a great deal of dependence on other factors in favor of continued fixed and stable income. The income from the rent is known in advance, but the tenants may stop paying, or a significant repair in the apartment during the year can significantly hurt the net profit. In addition, the further away the apartment is from the investor's place of residence, the more difficult it is to manage and monitor its condition. Bottom line, apartment maintenance is an ongoing operational challenge, in addition to the economic and bureaucratic challenges.

In investing in the capital market there are no tenants to deal with, but there is much greater volatility. No investment channel has a fixed, stable and pre-defined income of 100%, and the value of the investment can range from a huge profit to a significant loss.

A big challenge in finding an opportunity in real estate, diverse solutions in the capital market

When buying an apartment for investment, there are many parameters that must be taken into account in order to understand the viability of the deal - the area of ​​the apartment, the condition of the apartment, its location, the supply of apartments and demand for apartments in the area, future planning for that area,

Therefore, finding the right real estate transaction is a complex challenge, requiring a lot of time, knowledge, and ability to analyze the trends in the real estate market.

In an age where time is our most precious resource, the process of searching for a good real estate transaction can cost the investor a lot of money even before he reaches the stage of making the transaction itself.

In the capital market, however, an experienced professional can decide on the best investment for you. A huge amount of funds, securities and creative investment channels.

Yossi Barak (Photo: PR)

Strong collateral in real estate, compared to relatively few collateral in the capital market

The biggest advantage of investing in real estate is the strong collateral - a physical apartment registered in your name and owned by you. In the case of purchasing an apartment 'on paper', the buyer receives a warning note on the land, which produces a lot of peace of mind until the construction is completed and the key is handed over.

Investing in the capital market, however, does not include physical collateral. Stocks, for example, are an investment with no collateral at all, other than the company’s performance. A company’s stock value can plummet to zero and erase all investment in no time.

The solution for integrated investment in real estate and the capital market

for

the

first time in Israel: Real estate - all the benefits of investing in real estate, without the bureaucracy and taxation of the real estate market.

The dangers and costs of investing in real estate make many Israelis shy away from buying an apartment aimed at exposure to the residential real estate market.

The most innovative news in the field of real estate investments is a solution that combines all the benefits of one investment: Real Estate from the Barak Finance Group offers a unique, innovative and unique model in the investment world, which brings all the benefits of real estate investing to the world of financial investments.

Investors through Nadelhun get the opportunity to invest in a real property in a project in an area of ​​demand, with strong collateral and free payment of real estate taxes and high costs of professionals.

A rare opportunity in Givatayim (Photo: Imaging)

How It Works? Investors in real estate choose the project and the apartment in which they want to invest and receive a fixed monthly income in the form of rent and the amount of rent paid for such an apartment. The projects are in the format of a construction eviction and although there are no actual tenants yet Nadelhon pays the money each month throughout the project period.

At the end of the project, an appraiser arrives who assesses the value of the property and the difference in the increase in value received by the investor less the success fee of Nadelhon. The investor in real estate is not required to buy, sell the property or deal with bureaucracy at all - real estate manages the entire process, from the first moment, through the transfer of the monthly profit until receiving the final profits from the increase in the value of the property.

The investment through Nadelhon is made without bureaucracy and without the burden and responsibility of renting the property, but on the other hand with a strong assurance of a warning note on the land and full encumbrance of rights in favor of the investor - similar to what a buyer gets when buying a new apartment. In addition, real estate investors pay capital gains tax and are not required to pay all the high real estate taxation.

"We were able to bring a new line to real estate investors by lowering real estate barriers and improving profitability through the capital market," says Yossi Barak, CEO and owner Of the Barak Finance Group, which in addition to Real Estate manages about 18,000 customers and about NIS 2 billion in the worlds of real estate, insurance, investments in start-ups and more.

The flagship project of Real Estate - a quality building in the most sought after area in Givatayim

Nadelhon invites Israelis to invest in the first project of the project, located at Jabotinsky 71, Givatayim, and includes 33 premium apartments of 3, 4 and 5 rooms, penthouses and exclusive garden apartments.

"The building is located at the top of the sought-after Kozlowski Hill, which overlooks the entire Gush Dan," says Barak.

"Givatayim is crowded and there is no way to develop other than urban renewal, but the mayor froze all future permits, so that upon completion of the project he will be one of the few buildings in the city with new apartments. Demand in Givatayim is one of the highest in Israel. Better than ever!

Our goal at the Barak Finance Group is to enable investors to enjoy a smart investment by lowering barriers and improving profitability along with a strong assurance such as the warning note received at Real Estate. "For

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