As interest rates on traditional banking products have been virtually zero for at least three years, those who used to earn an annual income mainly through time deposits are now required to take the risk of making up for lost interest. Additional pressure is created by the rise in inflation which reduces the value of money. But what are the alternative forms of investment in which those who want to find a way out are eagerly looking. The main ones are the following:
- mutual funds
From the autumn of 2019 until today have a very large percentage of conversion mutual fund deposits has created a new generation of investors. Many of whom have acquired such programs for the first time in the last three years. This is the main reason why the majority of investments are made in controlled risk products, such as mixed (equity-bond) and bond mutual funds.
- bank insurance products
They are long-term programs that combine investment and insurance and are available from banks and insurance companies. In this case the payments are made either in a lump sum or periodically. The duration of the products is usually ten years. The production of insurance premiums in this category has increased in the last three years (2019-2021).
- real estate
A significant percentage of deposits is converted into real estate, while over time the demand increases more and more. The main buyers in the real estate market at the moment belong to the following categories of individuals:
1. Young people aged 20-30 with available funds up to 20,000 euros.
This category of investors is looking for small mobile phones aiming for a monthly income. Even with this money it is possible in cheap areas to buy a house that guarantees rents of up to three thousand euros on an annual basis.
2. Βorrowers up to 44 years with available funds around 60,000 euros.
They have the same participation required to obtain a mortgage (20% -30% on the value of the property). The money can come from various sources: personal, family, savings, from the sale of another asset. This category is a large part of the buying public due to the non-taxation of monetary donations from parents and high rents. Thus, they acquire real estate for their housing by paying a monthly installment to the bank, which can be up to 30% lower than the corresponding rent in case of renting the same property.
3. Parents with adult children – students
There are many parents who, after the implementation of the tax-free donation of up to the amount of eight hundred thousand euros, are looking for housing to meet the enormous need of their children. Typical examples are young couples and those studying in another city. In the latter case students use the house until they get their degree and then they can either sell it, recording goodwill if the prices have risen, or take advantage of it.
4. Individuals with available funds in the range of 100,000 to 150,000 euros
Recently, the mobility of individuals looking for investment properties has intensified. A typical example is the purchase of small shops in the center of cities that are in the center of shopping interest. We are talking about small properties that are acquired by investors, usually without financing, in order to achieve a high return through rents. At the same time, they expect an increase in values due to the significant renovations that are expected to take place in the areas of the city centers in the coming years.
