There is risk involved in every investment. But if you are looking to invest a chunk of cash, you want the most bang for your buck with the smallest risk possible. There are lots of other types of investments like business partnerships, stocks, angel investors, and so on, but real estate is the smartest investment you can make. Your money does not go as far as it used to because you used to make $40k at your job 10 years ago and lived comfortably but now it is not possible. You cannot control inflation to ensure your financial freedom and to save you or your family, you therefore need to have the right mind set about earning money. Although when you have more cash you have more freedom. However, money will give you the ability to provide a better life for your loved ones and yourself. Making money in real estate investment requires that you understand the positives and negatives aspects of it. Since real estate is something physical that you can touch and feel many investors see it as a tangible good and feels more real with it. Just investing in land for many decades has generated consistent wealth and long term appreciation for millions of people in the world. Depending on the location of a property, house investors can enjoy sizable returns on their investment. Making money in real estate is not as easy as you may think but some people take the home flipping route where they search for upset properties, renovate them and sell for a profit at a higher market value. Some other house investors invest in properties that can be rented to generate a consistent income. You must invest in businesses that give you positive cash flow, learn to handle inflation, learn to leverage your debt and take control of your physical assets. Most of the world’s richest people are rich today as a result of investing in real estate. Investing on land and other property like houses are some other real estate investment that people are focusing nowadays in order to make money. Therefore, there are plenty of reasons to think that investing in a land is a good venture. But like any other investments, it is better to be informed before diving into it. Unlike buying stock, which may cost a dollar or more per share, you can easily pour six figures into your first real estate investment property. You may be interested in buying an investment real estate property if you want to expand your holdings beyond bonds and stocks. Although stories of how house investors performing quick flips continues to dominate TV reality shows, renting is the main core of real estate investment. That is, in the past there has been very low real price appreciation in houses. Are you currently making money in real estate? Are you planning on investing in land or buying property? Do you automatically like the idea of investing in income producing real estate with results you can see, like what a house investor does? Take a look at some of the reason why real estate is considered as your smartest investment and the excellent choice for protecting and growing your wealth:
It is a Physical Asset
Real estate gives you a hands-on investment opportunity. That is, by buying property, you see the fruits of your moneys and you are a part of the process. You can meet the people who manage your investment property and see the way they are spending your money. Also, you will always be able to estimate your return. Just by looking at comparisons in the market, you get a clear picture of the value of your investment. It is better in investing in land or buying property rather than blindly sending your money to a business whose nameless employees choose your stocks, you see real results and work with people that you know. Real estate producing income is one of the few investment classes that, as a hard asset, has significant value. Buying a property like land and building a house on it has value and the income it produces has value to future house investors. As does the stock market income producing real estate investments do not have red and green days.
You will Gain High Asset value appreciation
In time, real estate always appreciates. If you work with experts, they can help you find the right market at the right time. You will likely see even greater gains than the average house investor if you invest in real estate income generating property like investing in lands or houses. Over time, the economy has suffered more and more inflation, drastically reducing the buying power. Nonetheless, real estate income producing investments have historically provided outstanding appreciation in value that meet and exceed other investment types. Properties historically increase in value as the net revenue for operation of the property improves through rent increase and more active management of the asset.
Property Value Always Rise Back up
There is risk in every investment that you carry out because it is not all the time that your investment will be good. Nevertheless, if you hold on to your real estate investment during bad times, the market will in due course rise again. But this is not true with stocks. Many people lost millions of dollars in the stock market during the recession but in 2008 when the market crashed, real estate owners who held onto their property saw the value of their property eventually coming back. Values of a home continue to rise over time and it is guaranteed even if there are setbacks along the way.
The power to use leverage to multiply asset value
You do not need all the money up front in buying property or a home. Often, with 10% (or less) of the purchase price, you can buy a house and use the money to save for other things or investments. Another important attribute of commercial real estate investment is the ability to place debt on the asset, which is several times the original equity. You have direct control over a lot of thing that can be used to increase the value of your property and your investment. For example, you can fix the bath room and up the selling price or rent. You can renovate the roof and up the selling price or rent. You can basically buy and sell property at the right time for the right price that you wanted and see a net gain. With this, you have much more direct control over the value and worth of your investment than other types of investments, so you are not completely at the mercy of fate. Positive leverage placed on a house allows the house investor to effectively increase positive cash flow from operations by borrowing money at a lesser cost than the property pays out.
You have Unlimited Resources and a Time to Test your Model
You are not the first person to invest in real estate and you will not be the last. Millions of people around the world invest each day in buying property. Most of the problems you are facing or you think that you will face, someone has once faced it before. And the community of real estate is one of the most supportive communities you can join. Sure, we may be a little unfair, but someone’s always willing to help you figure out things when you need it. Investment should never be taken lightly. The choice on where to put your resources is always a big decision. But, all things considered, real estate consistently will be one of the best choices you will find for low-risk investment with the potential for big returns.
You can Fight Inflation
Inflation is unavoidable. There is a corresponding liability for each dollar that is created. Real estate investments have historically shown the highest connection to inflation when compared to other asset classes. As countries around the world continue to print money to spur economic growth, it is vital to recognize the benefits of buying property as a hedge against inflation so that as expenses go up, you can adjust for it by increasing rent of the property. In addition, your asset is a commodity gaining value. As goods become more expensive, so does the housing market and you can use the opportunity by making money in real estate.
Real Estate Investment has Less Risk
Compared to other investment such as stocks which is risky, real estate investment always carries some risks and there are a lot of possible pitfalls where you can lose big, on the whole, real estate is less of a risky investment. Stocks are quite unstable and when they dip and grow so does your investment, directly. Real estate ups and downs happen a lot slower than that and do not always influence your bottom line, especially if you have a renter and they continue to pay their rent. Loans from banks or other sources, even online ones are fairly easy to get, although many lenders have implemented severe standards post-recession. Buying property is and will continue to be a smart way of investing, especially when many people, companies and lenders have learned their lessons in the outcome of the 2008 recession. You have a lot of flexibility on how to improve the value of your property since there are a number of ways to make income off it and it has less risk than other forms of investment. Yet again, it is so cool to see why real estate investment is considered as an extremely smart investment.
Real Estate Gives Options
Things can change but investing in land or other property gives you flexibility. The good thing with you investing in land is that you have the liberty to take additional loans against your property if you want. As a house Investor you always have the option to move into the house you’ve bought if you need a place to live, then rent it again later. Making money in real estate is something that depends on the investor since he or she have many options to capitalize on. That is, you can either rent or flip out a property and better still you can purchase a property at a very cheap rate and then sell it for a higher price to the right buyer. You can even purchase properties in your neighborhood or others, fix them up and make the area a more desirable place to live in. By so doing, you have improved people's life style of living and you can even charge more for rent as well. The great thing about making money in real estate is that, there are various ways you can capitalize on in your real estate investment by just being creative. You can do this by simply; market research, buying property, selling property, planning strategic repairs and improvements. With all these, the value of your investment goes up and before you know it, you are making money in real estate.
Confident cash flow
Although you are the one responsible for maintaining the property, taking care of tenant’s issues and providing proper insurance coverage for the home, real estate investment offers some appealing solid passive income. Since leases generally secure the assets, it is one of the biggest benefits to income producing real estate investments. With this you have a regular income stream in the form of rent that is considerably higher than the typical stock dividend yields. This revenue will especially be of value at retirement time, as if you continue to own the property you can collect your normal revenue on it. Making money in real estate constantly is also a great way to save for retirement. Particularly if you scrutinize tenants properly and get some truly good ones, you can have dedicated renters for many years.
The Pride of Ownership
Investing in land or property in the precise location with the true tenants and ownership mindset can produce a marvelous pride of ownership factor that is superior among all asset classes. Owning a home is the desire for most people. The future of rental of income properties’ values cannot be ensured by any one, but this asset class seems positioned to continue to profit from many other socio-economic issues.
The bottom line about smart real estate investment is to keep your expectations real. Real estate investment is considered a smart investment because it offers a good high-value risk-return profile. There are many positive benefits of real estate investments such as depreciation, tax deductions and exemption from paying capital gain taxes as long as you invest your money into a similar kind of property; these are some of the things that make real estate investment smarter. If you were still thinking or doubting on investing in land or home, with the above reasons, you can now clear your mind and make a decision.