Why should you invest in real estate? The answer is simple. It’s a low risk, high return investment.
Real estate or real property has been used for centuries as a measure of wealth and success. Look at the major business tycoons of today—most have dabbled in real estate.
Of course, we can’t all expect to become rich from real estate, but even the average person can expect to see handsome returns on investment when they do their homework and invest wisely.
Reasons to invest in real estate
Real estate, unlike other investment vehicles, is fairly low-risk. Let’s compare real estate to the stock market.
The stock market is often unpredictable and is a roller-coaster ride subject to rapid rises and falls. Let’s say you have $10,000 and invest it in the stock market. After a few years, you might make $22,000 pre-tax if you are lucky. If you had instead used that $10,000 towards a down payment on an $80,000 condo, in the same time period, the condo could reasonably appreciate to $125,000. If you sold the condo, you would make $45,000, tax free.
The benefits of investing in real estate are plenty. Aside from reaping the benefits of appreciation and tax free profits, it also acts as a forced savings plan. Every time you make a mortgage payment, it goes towards building future security. Over time, equity is built up which can go towards home renovations or other investments.
Real estate is an inflation-resistant investment, providing homeowners with a tangible incentive to save. Owning a home is widely accepted as one of the soundest financial commitments you can make.
How do I start investing?
Many people think, “Well, the first thing I need is tons of money.” This is not always the case.
Your bank account does not need to be overflowing to invest in real estate. All wealthy investors started somewhere—you just need to know where to look.
Assumable mortgages, group investing and low buy-in development opportunities come and go all the time.
What an aspiring investor needs is the right leads at the right time.
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