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How Real Estate Crowdfunding Can Help Generate Wealth in Latin America

Sep 5, 2016

Despite a period of economic uncertainty and turbulent markets, Latin America may yet experience fruitful growth in the region’s economy over the next twelve months. Steps towards a more positive economic outlook have been taken by a number of Latin American countries, making this an ideal time for Latin American investors to profit from the potential new prosperity.

Argentina, for example, is in a good position to jumpstart its economy. Having experienced high rates of inflation and a deep financial slump, Argentina is now in the midst of an economic turnaround facilitated by the election of Mauricio Macri, which has put an end to twelve years of presidential control by the late Nestor Kirchner and his wife (and successor) Cristina Fernandez de Kirchner, a period nicknamed as the time of “Kirchnerismo”. Macri is pro-business, having been a successful businessman himself, and one of his main policies is to reignite the Argentine economy and reinvigorate foreign interest in Argentina’s markets.

According to Director of the Latin America Economic Growth Initiative Jason Marczak (speaking to Forbes), Macri has already begun to implement his plan for growth with four major decisions: “a repositioning of international ties, a focus on removing capital controls, re-appointment of credible accountants for handling inflation data, and putting in place a well-experienced cabinet of technocrats”. Macri’s approach is essentially the total opposite to that of his predecessor Cristina Fernandez de Kirchner, whose economic policies many believe are the root cause of Argentina’s overall alienation from the wider global economy.

Due to a degree of interdependence in the Latin American region, the appointment of Mauricio Macri will have a number of positive knock-on effects for Argentina’s close neighbours. Jason Marczak believes that Brazil, for example, may see a heightened interest in investment and trade from the rest of the Mercosur trade bloc, most likely due to a less insular economic outlook on the part of the sub-region as a whole. This may well help a struggling Brazilian economy (whose GDP fell by 3.8% last year) to find new income from a rising network of Latin American investment, not to mention new interest from the US, which is being encouraged by the pro foreign investment policies of Macri – according to the Financial Times, injunctions on Argentina issuing new bonds were removed by a US court back in February, thus demonstrating the level of attention America is now paying towards Latin American markets.

With the Latin American economy moving towards potential growth over the next twelve months, Latin American investors can now look at capitalising upon new investment opportunities that have presented themselves in recent years, following the ever-increasing sophistication of the internet and worldwide online systems. Real Estate Crowdfunding represents one such opportunity – a chance to generate new wealth in Latin America by using the global reach of online platforms. Investing with a Real Estate Crowdfunding platform such as Bricksave provides higher returns than those of stocks or bonds, while at the same time offering more security in the form of actual bricks and mortar, meaning that investors have a solid part of their investment portfolio that’s steadfast and secure; this in turn allows them to take on higher risk investments in the remainder of their portfolio. Investors in Latin America can use Bricksave to help create a stable spread of investment in different asset types, establishing their investment in real estate as a secure base, thus allowing them to properly diversify their overall portfolio and achieve the highest potential for capital gains. Diversification in this way is also helped massively by the global nature of online Real Estate Crowdfunding, giving investors the opportunity to spread their money across properties in multiple countries and profit from the world’s most desirable regions. (This global attitude is reflected nicely in the foreign economic policies of Macri, who is currently trying to re-establish financial ties with the rest of the world economy.)

After Massolution announced that the crowdfunding market grew 167% between 2013 and 2014, it is clear that the industry is on track to become one of the world’s leading forms of raising funds. For Latin Americans, this means that there is now an opportunity to profit from both the accelerated expansion of equity crowdfunding and the projected economic upswing in Latin America over the next year or so. Real Estate Crowdfunding offers Latin Americans a more democratized version of investment, one that enables more people to invest smaller amounts of money and gives those who may not have previously been able to invest the chance to do so; this therefore provides more opportunities for people to grow their money, and subsequently creates more wealth in the region. Bricksave offer an easy way to get involved, with all administrative processes handled entirely by us, leaving our investors in Latin America to sit back and enjoy a passive stream of income.

 

by Bricksave CEO, Tom de Lucy

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