5 Reasons to Invest in Real Estate
Real estate allows you to take control of your financial future. It enables you to control your assets and your business performance. If you invest in real estate, you become the sole person responsible for your success or failure of the investment you made. This is an extremely powerful thing, as you get to influence both asset worth and cash flow.
2. Tax Benefits
Real estate offers some tax benefits to owners in the form of depreciation and cost segregation. Being a landlord allows you to deduct mortgage interest and real estate taxes on rental properties. The government understands that providing affordable housing is a hard task, therefore it created these write-offs to encourage the private sector to step in.
3. Property improvement for equity
Many investors decide to buy properties that could use extensive improvements. This is a good strategy because the improvements often exceed the cost, which results in an immediate increase in equity. Equity represents the difference between the current fair market value of the property and the amount the owner still owes on the mortgage.
Rental properties usually appreciate in value with inflation, while mortgage payments on the property remain stable. For the investor, this increased value can lead to sale or reinvestment in higher value properties. It can also provide an equity line of credit to use for other investments.
5. It is easy to get started
The truth is no one needs any specialist knowledge to start investing in real estate. Many investors didn’t start off with the intention to make fortune through property ownership. They just bought residential property in order to live in it. However, after seeing the value of their home increase and realising the potential profit that it can bring, many investors took a risk and started investing in real estate.
6. It is an asset you can actually use
A property is a property: if your investment is not successful, at least you can move into that property and make it your home for a while. Whether we are talking about commercial property or residential property, the point is that a property is an asset you get to keep even if things go wrong, which is basically impossible when it comes to company shares for examples.
7. You benefit from other people’s spending
If the government or certain companies invest in infrastructure such as roads, rail and airports, the value of your property can increase if the accessibility in the area in a problem. Furthermore, investment in universities, hospitals, factories, restaurants and shopping centres can increase housing demands due to the new employment opportunities created.
8. You can pass it onto your children
A property is a great legacy for your children and grandchildren, as it can continue to grow in value over the long term. Depending on the legal structure in which you own your properties, you can pass your investments onto your children either before or after you pass away.
9. Positive Cash Flow
Real estate investments may offer you positive cash flow after paying all your expenses. The cash flow increases over time, as your mortgage financing decreases and rental rates increase. This creates a secure retirement income, which proves that real estate is a good investment for the future.
Real estate delivers the greatest opportunity to use the power of leverage. Leverage means using borrowed capital to enhance the earning potential of an investment. Since real estate is a tangible asset, financing is easily obtained in general, while your potential returns may increase significantly.
If you decide that real estate is the right investment for you, Kearney Auctioneers display a variety of properties on this website. Have a look, you may find the right option for your future!
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