Many investors avoid real estate investments because they think real estate is risky. Others don’t get involved because they believe you need big money to do so. Both notions are misconceptions. Investing in real estate is one of the safer ways to put your money to work, and you can make a smart profit if you practice a method known as house-flipping.
In this blog, we’re going to break down the advantages and disadvantages of real estate investing in a frank and straightforward way to help you determine whether or not real estate investing is right for you!
1. Excellent Returns
If you invest in the right property at the right time, you could make a substantial amount of money in a relatively short period. Generally speaking, the value of real estate increases over time. And annually, real estate earns more than stocks, bonds, and other investment vehicles.
2. The Tangible Asset Value Of Real Estate Is High
Real estate is a tangible asset with intrinsic value. Moreover, it can be used as a generator of revenue. Unlike other investment vehicles with little to no value, real estate can retain its value over many, many years. Plus, it can be liquidated if this is necessary.
3. Tax Deductions & Breaks
Real estate investors can take advantage of tax deductions and breaks, and these help them save during tax season. And if you hold a piece of real estate for a long time before selling it, the proceeds will be taxed at a lower rate. Plus, you can write off mortgage interest, homeowner’s insurance, maintenance and repair costs, and property depreciation.
4. The Cash Flow Generated By Real Estate Investments Is Predictable
It’s hard to predict cash flow for a lot of investments. With real estate, things are easier, as you know when rent is due and how much it is. You could even rent your home for a portion of the year and use the money generated to reinvest in the property.
5. Inflation Hedge
In an environment where inflation is high, the property price is elevated because it’s a physical asset with real value. Real estate has been used as an inflation hedge for a long time, and these days, this quality is especially relevant, considering most of the world is currently dealing with record-high inflation.
For many, investing in real estate is much more than a means to make money; it’s an incredibly enriching endeavor that betters the investor in various ways. If you conduct thorough research, you can use real estate investing to generate a handsome return, whether investing in commercial real estate, multifamily homes, or single-family houses. Are you looking for a lender with the best transactional funding for real estate professionals? Look no further! Real estate wholesalers across the country get flash funds from DoubleClose.com. There are no upfront fees, and funding is released right away. Get in touch with us to learn more!