Top 10 Benefits of Real Estate Investing
There are many benefits of investing in real estate, perhaps even more than one thinks. So if you are considering a purchase in real estate soon, here are some of the best benefits of investing in your next property.
Equity
One of the most straightforward ways to pump up your wealth is when you make each of your mortgage payments. As time goes on, your property appreciates and the more equity you build.
Diverse Portfolio
It is always wise to diversify your portfolio. Instead of putting all of your eggs in one basket, invest in real estate so that not all of your money is in stocks or funds of the same nature.
Inflation Safeguard
Inflation can make one nervous but real estate markets are not really impacted by it. Expenses that are associated with keeping it up may increase, but rents can be increased as well to keep your cash flow positive.
Passive Income
The better condition your property is in, the more you will be able to take in for rent. This passive income of rent is one of the best perks to investing in real estate. Be sure to capitalize on it with a good property for a good tenant.
Cash Flow
To determine your cash flow, take a look at your net income. That is basically your gross operating income minus your operating expenses. So after you take in your rents and deduct all of your monthly associated expenses like taxes, utilities, etc. then what’s left is your cash flow.
Appreciation
One of the best benefits of real estate is that it generally appreciates over time. Be sure you are investing in the right market and area where values are on the rise. This will help build your wealth over the years.
Goal Funding
Investing in real estate can also help you achieve your goals. Perhaps it is to build wealth for eventually paying for a child’s college tuition or maybe it will help you afford the purchase of another rental property.
Leverage
With real estate investing you basically can leverage the bank’s money to make your money. In other words, you can have maybe 80% of the cash fronted by your lender while you collect the rents. In typical stock market investing, you would have to put up all of the money yourself.
Tax Benefits
Real estate investing comes with some great tax benefits. Those include mortgage interest, loan origination fees, maintenance, repairs, marketing and management fees.
No Diploma Needed
One of the best things about real estate investing is that anyone can do it. That means there is no particular education or degree required to jump into the game and start building wealth.