The Four Pillars of Successful Real Estate Investing

Posted by Ronan McMahon

Share on Facebook

Tweet on Twitter

When sizing up a potential real estate location, I always look for one of four strategies that indicate a potential rise in property values:

  • A new, emerging middle class
  • The Path of Progress
  • An influx of foreign buyers
  • Distressed or crisis opportunities

One of my hottest locations for real estate opportunities right now is Fortaleza, on Brazil’s northeast coast. I identified two strategies at play when I first scouted this city more than two years ago, and they still hold true today.

A new, emerging middle class means new consumers. These new consumers buy cappuccinos, refrigerators, cars, vacations, new homes and second homes. This started happening in the US in the 1950s.

We can profit by owning the condo this new middle class lives or vacations in, or the building that houses the coffee shop where they sip coffee.

Brazil has become a middle-class country. Car sales were up 17.9% for the first quarter of this year. Domestic budget airlines are growing exponentially, as this new middle class takes flight to various business and vacation destinations. In the first eight months of this year, 1.95 million new jobs were created – double the figure for the same period last year. The latest forecast for GDP growth this year is 7.3%.

Fortaleza is Brazil’s biggest domestic tourism destination. Brazilians come here to relax, sip cocktails by the beach, enjoy an evening meal and some entertainment. Passenger traffic at Fortaleza airport increased 23% year-on-year to the end of August 2010, and cargo traffic…Read more