Resilience is a value that occurs to a greater or lesser extent in all investment sectors. Some, such as the real estate sector, stand out more than others because of their known resilience before economic crises. In other words, the real estate sector has a great capacity to recover optimal rates of return on investment.
The real estate sector has demonstrated in countless periods of economic instability that its value stagnates or fluctuates in a controlled range, to resume the increase of its value as it comes out of the crisis. This is a trend that has been observed throughout the history of this sector and there is no reason to believe that this will change. Real estate will continue to be more profitable, compared to other assets, and will recover better than various industries.
This resilience, which even surpasses previous positive standards, is due to their status as “tangible assets”. They are physical places that can be used for living, renting, remodeling and selling or leasing. If we talk about rentals, the cash flow that comes from them is backed by short, long or medium term contracts.
To the above we must add the value that will bring you the capital gain and the fortune of being investments shielded against inflation.
Resilience in previous crises
Let’s talk about previous cases where the resilience of the real estate sector has been exposed. The last critical period took place between 2008 and 2010, when the so-called “housing bubble” burst in the United States, not only did the sector recover, but also increased in value above that recorded before the crisis.
In Mexico, as a result of the events of those years, the construction sector observed a “slow but steady” recovery. It only has to be considered that it represents 15% of the national GDP, generates more than 14 million jobs and is the beginning of 48 economic branches.
And if we talk about growth, this industry has had an excessive rise in recent years. Between 2014 and 2016, the GDP corresponding to the real estate sector grew above the national GDP. By the end of 2016, INEGI reported that it grew by 4.2% per year and future projections, optimistic, have been reached year after year.
Resilience, that capacity to overcome adversities, is a privilege of the real estate sector: it generates optimal profits before, during and after periods of economic instability, as well as presenting an increase in its value afterwards. Because of its historical performance and unique qualities, we know that it is the best investment option in the market.
In Grupo DESUR we have exclusive real estate projects located in areas of high capital gain that will optimize your investment. Come to us to know the options we have for you.