House prices have made real estate unattainable for Millennials and Gen Zers. According to a 2022 Bankrate survey, both groups pointed to a lack of income and low credit scores as the main obstacles to investing in property. There’re certain steps potential homebuyers can take to make their dream of owning real estate a reality.
The Founder and CEO of Blue Castle Ventures, David Rojas, see the light at the end of the tunnel. In fact, he believes Millennials are already changing the nature of the real estate game by embracing technology and that Gen Zers will follow suit as soon as they acquire enough financial stability to invest.
Having generated $1.3 million in revenue in 2021 alone, today, the Harvard Business School in Alternative Investment graduate coaches others on how to make the most of their hard-earned cash. Here’s his advice for Millennials and Gen Zers wishing to enter the real estate market.
Rojas believes that setting goals are imperative to success. Whether completing a University degree, starting a business, or buying a new home, having concrete goals in place can help guide your focus and motivate you. Setting goals can also give you a more refined long-term vision and help you measure your progress.
“To create a solid financial foundation, it’s necessary to spend less money on unnecessary things, have a clear goal about why you want to invest, and surround yourself with more experienced advisors and business people,” Rojas says. “I know a couple of 27-year-olds who have been following these simple steps since they were in High School and nowadays, they are extremely wealthy. Setting goals, patience, and quality guidance are paramount to achieving your financial goals.”
Take Things One Step at a Time
Let’s face it, nobody builds a real estate empire overnight. Instead, owning property is a long-term investment. While people do make money by flipping homes, this is generally considered a risky strategy. Short-term real estate investment doesn’t just require equity, it also takes timing and in-depth knowledge of the local property market.
“I would advise young people to initially buy real estate as a matter of business, not as a place to live, particularly if they can still reside with their families,” Rojas says. “They could start with a condo and rent it out to an entire family. They could also buy a house not far from an educational institution and rent the rooms out to students, perhaps even acting as a live-in landlord or landlady.”
“While this strategy may not seem very appealing at first, it will ensure that the investor creates equity and later on passive income,” Rojas continues. “Those could form the bedrock of other more sophisticated investments, allowing the investor not just to eventually buy their dream home but own multiple properties.”
Beware of Get Rich Quick Schemes
According to Rojas, technology has opened the world up to risky investments. And this doesn’t just apply to real estate. The recent cryptocurrency crash has shown us that no investment is full-proof, particularly when it comes to the digital space. “People thought that crypto would just keep going up. But the market only has a certain amount of traders and money so it can’t go up forever,” Rojas explains. “If there is no education behind the investments, even initially making a great deal of money can end badly.”
The problem, Rojas says, is that many of today’s investment vehicles — such as crypto and NFTs — lack tangible backing. This is where Blue Castle Ventures is doing something different. With Royal Bank of Canada, Interactive Brokers, and PayPal in the background, the community marketplace offers a real-life collateral-backed stablecoin called $BCVD to buy and sell assets. “The $BCVD is backed by dollars and there is no speculation for the coin. They are always 1:1 with the US Dollar,” Rojas says.
“The problem with crypto is that there’s no real collateral behind it. You are essentially trading air,” Rojas continues. “We have developed our own blockchain to register real-life goods such as paintings and sculptures, and we are looking forward to using the same system to purchase and sell other goods such as music and real estate.”
Making Wise Investments
Rojas says there’s a good reason behind his company’s name — Blue Castle Ventures. “The initial idea was for Blue Castle to be a marketplace for trading real estate. Before we took this step, however, we wanted to test run the company by trading smaller assets such as NFTs,” he says, adding that since its inception, the company has grown from strength to strength.
Whether you’re a Millennial, Gen Zer, Gen Xer, or even a Baby Boomer, investing in the wrong property or sending your money into the abyss with a click of a button on your keyboard can be devastating. This is where both research and qualified advice can be crucial. “If an investment takes your sleep away, don’t do it,” Rojas says. “It also pays to have clear goals in mind. I always tell my clients, ‘Investing is like a road. If you don’t know your destination, you will get nowhere.’”
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