Having a property portfolio can be key to achieving financial freedom.
By Danielis Fermín
El Inmobiliario
SANTO DOMINGO –You've probably heard phrases like, "Keeping money under the mattress isn't a good idea" and "Investing is essential for financial freedom." These are typical expressions that personal finance experts often repeat. However, one question always arises: where is the best place to put your money?
Currently, there are several alternatives that allow you to generate income through different means. For example, the stock market, entrepreneurship, and building a real estate portfolio.
Financial mentor Luchy Álvarez states that “having different types of investments offers greater security and less risk, since resources are diversified.” Among the options available for those wishing to develop real estate portfolios are the acquisition of commercial premises, properties intended for short-term rental, or the construction of multi-story buildings for rent.
“These alternatives generate monthly income,” Álvarez emphasized, explaining that “it’s an excellent strategy to start your real estate portfolio. Later, you can invest in something that requires more resources but also offers higher returns. Finally, you can choose a project whose objective isn’t to generate monthly income, but rather a sale that increases your net worth or wealth.”.
Financial errors
According to Álvarez, one of the most common mistakes when designing an investment strategy is acting rashly. “For every five hundred successful real estate projects, there is one that turns out to be a scam. Those who buy into that scam are generally the ones who make hasty decisions.”.
Luchy Álvarez. (EXTERNAL SOURCE).
Furthermore, he warned: “If you sign a multi-million dollar contract without proper advice, and you simply ask a cousin who's a salesperson for tips, have a lawyer neighbor review the contract, and validate the construction company and the property value on social media, you might not spend money right away, but you could end up spending much more later on lawyers, repairs for construction problems, and other expenses.” He emphasized the importance of dedicating the necessary time to conducting thorough research.
Another common obstacle is indecision. “In 2024, I wanted a villa for Airbnb. I had a clear concept: three or more bedrooms and a pool. However, all the prices went up and the numbers didn't add up. So I took one of my lots and built. Now I'm generating thousands of dollars in rentals,” Álvarez recounted.
“The current return on investment and the property's market value is RD$6 million,” she explained. Since 2009, Álvarez has worked as a finance professional for several construction companies and manages both personal and corporate real estate investment portfolios. “I knew this involved a greater time investment and a higher risk, but I also knew I would obtain greater returns. Staying still and waiting for circumstances to change is also a mistake.”.
Therefore, her main recommendation is to just start. “It’s normal to feel scared at first, but you overcome it over time, little by little.” She also emphasized the importance of having a solid plan that includes contingencies for potential problems, as this provides greater peace of mind during the process.
Network of contacts
For Álvarez, having a network of contacts is essential for identifying investment opportunities, since not all properties are advertised. “If I know someone in my network who can take advantage of a good opportunity I find, and I can’t take it on at that moment, I pass it on to them.”.
He also emphasized that a well-built network provides access to experts such as appraisers, engineers, surveyors, and other key institutions within the real estate market. "What a network can contribute is invaluable," he concluded.
