Purchase of a luxury house with a pool or a villa as an investment

Whether to invest in buying a house with a pool or a luxury villa is a question that undoubtedly crosses the minds of many entrepreneurs. Most successful entrepreneurs prefer to invest their surplus capital in real estate, and luxurious houses and villas with pools certainly emerge as interesting options.

The majority of entrepreneurs choose to invest in luxury villas with pools because, unlike other types of properties, they can personally enjoy them when not in use for rentals.

The first thing you need to decide is whether you will buy a new and fully equipped luxury villa, purchase land and embark on construction independently, or acquire an existing property that needs renovation. Each of these options has its advantages and disadvantages, and we will briefly share our opinions on them below.

Buying a new and fully equipped villa ready for rental is undoubtedly the most elegant option. In this option, you don't have to deal with obtaining permits, architects, and contractors; instead, you receive a property ready to generate income immediately. Potential drawbacks of this option include the inability for the property to fully align with your preferences in terms of layout, design, and the possibility of hidden defects such as poorly executed installations, which may only become apparent during more intensive use.

Buying land and undergoing the independent construction process is certainly the most demanding process, but on the other hand, it allows you complete freedom to design the villa according to your preferences, which is the main advantage of this option. Another significant advantage of this option is the potential price difference you can achieve when selling the property. On the flip side, the main drawback of this option is the lengthy and stressful process. Be prepared for a long wait for all necessary construction permits and architect drawings. Once you have everything ready, the most challenging part begins—the construction. Anyone who has experienced building or renovating a property will tell you firsthand how demanding this process is, especially if you lack prior experience in this field. Finding quality contractors is extremely difficult, and constant supervision of the construction process is essential. There is also the option of purchasing land with an existing project and obtained building permits, which definitely speeds up the entire process, but you lose some freedom in terms of design.

The third option, buying an existing house with renovation, is a compromise between the first and second options. If you opt for renovation instead of tearing down the house and building anew, it is crucial to find a house that is as close as possible to your vision since you won't be able to make many changes to the layout, only to the interior. The advantage of this option is the speed of implementation compared to building from scratch, with the possibility of decorating according to your taste in terms of interior design.

When calculating the return on investment speed, you should consider the potential price difference you could achieve when selling the property. The actual price difference will, of course, depend on the future market situation and the price at which you purchased the property at a given time. However, generally speaking, the greatest price difference will be achieved in the second option, buying land and constructing independently, and the smallest when purchasing an already finished property.

If you need advice on which locations, micro-locations, and amenities foreign guests most often seek for renting luxury villas, feel free to contact our sister company, LUVA Villas, with years of experience in renting luxury villas throughout Croatia.