The Effect Of The Coronavirus On The Stock Market Boosts The Real Estate Sector
The effect of the falls in the financial markets caused by the coronavirus has triggered real estate interest in the main sites for tourism in Mexico, for real estate investment,
especially in the Riviera Maya due to its capital gain.
The reorganization of investors assets focuses on the acquisition of buildings in the city centre and commercial premises in prime areas. The effect of the coronavirus on the Stock Market is noticeable in the Mexican real estate sector. After the Black Monday of the markets, the S & P / BMV IPC, the main index of the Mexican Stock Exchange (BMV), closed with a gain of 2.16 per cent and was placed at 39,565.44 units. The affected financial and share markets driven by a rebound in international oil prices, after the fall in those affected, generated a strong negative impact during the past week.
The advance in the markets was also driven by the expectation of the Trump administration implementing an expansive fiscal policy to counter the probable adverse effects of the coronavirus.
However, this scenario is having dynamic side effects for the Mexican real estate market. And it is that the lack of security of short-term investments has triggered investor interest in the main Mexican spots for real estate investment, especially in the Riviera Maya, where the interest of investors and family offices has increased a 30% in the last weeks. * Expansion of Magazine Data.
It is not surprising that at a time when volatility is more than notable, investors move to other safer sectors such as real estate in prime assets because at the moment the limitation is minimal risk and betting on stable assets that they will have profitability of at least between 3% and 6%. Said profitability is the intrinsic one that is perceived with rents, not counting the effect of financial leverage, which can raise said profitability to 7.5% -8.5%. The return on investment can be much higher if they take into account the most valuable possibilities that can be obtained at the time of the divestment.
The main objective of investors is the reorganization of their assets, areas with a high concentration of companies and tourists, continue to be the areas most requested by real estate investors.
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