If you were to ask 100 people which form of investment is the safest and secure, what do you think would come out on top?
Without a doubt, real estate would be miles ahead of the competition, and even more so today. Millennials seem to have caught the investment bug and the knock on effect has been a rise in housing prices as more and more people want to get on the property ladder.
But the question is, should you? What are some of the main benefits of investing in real estate that you could be missing out on? To find out the answer to this question we have put together 6 things worthy of your consideration when deliberating over whether to get in on real estate.
1. Passive Income
No matter where you go, you would struggle not to overhear a conversation about how prices are rising. This means bad news for most of us, but one of the benefits of investing in real estate is having that additional income serving as protection and taking the pressure off the burn we’re all feeling.
Once you start investing in real estate, the money earned can be used to cover your basic expenses, as well as any outstanding loans. This will give you the peace of mind that many would dream of having.
For you to keep reaping the benefits however you need to do one thing.
Research.
This includes whether you want to reap the benefits of a real estate investing group or buy a property yourself, to vetting your tenant’s payment history. Doing so will go a long way to making sure you can reap the benefits long into the future.
2. Freedom
Eat, sleep, and work is the usual routine. This can leave you feeling like you are on a conveyor belt without much control of where your life is headed. However, getting in involved in real estate is able to give many a new lease on life. How so?
Firstly, the extra income is a great way for you to work towards having financial freedom. The ability to choose and not be forced into making life decisions based on how little is in your account is one of the best benefits of investing in real estate.
In addition, once you learn how to invest in real estate you will have one area in your life that allows you to be your own boss. This gives many investors a great sense of fulfillment.
3. Tax Advantages
Another one of the benefits of investing in real estate comes in the welcome form of tax deductions.
There is a range of expenses that can be deducted from your tax bill. These include marketing your property, insurance, repairs and maintenance, legal fees, travel-related costs, and property tax.
If you are also able to sell in the future at a profit then you will pay capital gains tax, which is lower than income tax. All in all, a win-win!
4. A Protection Against Inflation
What word gets people in a flurry more than any other when it comes to their finances?
Inflation.
But did you know that there is one group that doesn’t need to panic when inflation rears its ugly head? It’s those who invest in real estate.
This is because inflation is linked to the general cost of living. That means that if everything you depend upon like fuel to your weekly supermarket shop goes up then rental and property prices do too. This means that you are covered as your income will increase and cushion any blows to your wallet.
5. Diversifying Your Portfolio
Another way to protect yourself financially is through diversifying where you have your investments. It is always advisable to have your money working for you and there are various ways to do this, such as having a foot in the stock market. But the element of risk is always there if you are relying just on that.
Remember, there is a reason for the expression safe as houses! Having property in your portfolio is a great way to give it a solid foundation. Leases guarantee income for their term and rising inflation and fluctuating share prices will not affect at least one of your assets.
6. A Safety Net
Imagine buying something that you could be confident in selling for more money if you needed to in the future. Getting healthy returns on nearly everything we buy, from cars to shares, comes down to sheer luck, especially if we are talking about 20 to 30-plus years into the future. But houses are different.
Knowing that no matter what happens, people are going to need places to live in long into the future is one of the key benefits of investing in real estate.
When you add appreciation into the mix, whether you begin investing in real estate becomes more “why not?” than “why?”. Property tends to be one of the few investments that continue to grow in value over the years, meaning that getting involved now can give you long-term security no matter what happens.
Start Reaping the Benefits of Investing in Real Estate Now
As we have seen, there is a lot to be gained when you invest in property. Are you ready to take the plunge?
Whether you are deliberating whether to dip your toe into the pool of real estate or you are already seeing the benefits of investing in real estate check out the rest of the great property-related content on our site!
