When you think of investing do you think of mutual funds, bonds, and the stock market? Most people do, but did you know that real estate provides better returns on your money than the stock market, and with less volatility?
In fact, history supports the fact that real estate is a strong and stable investment.
“More money has been made in real estate than in all industrial investments combined.”
-Andrew Carnegie, billionaire industrialist
Mr. Carnegie lived through most of the 1800’s and died in 1919, but his words hold true to this day. There are many ways you can invest your money, such as stocks, insurance, bonds, and CD’s, but the benefits of investing in real estate outweigh most other kinds of investments.
If you’re looking for a reason to invest in real estate, here are six of them:
- Cash Flow
Positive cash flow keeps businesses alive. When purchased correctly, real estate provides a consistent revenue stream. This is especially true if you use your real estate as rental properties. Land some quality tenants and the rent they pay can pay off the mortgage as well as create passive income for years.
- Tax Benefits
As a real estate investor, you’re running a business and that entitles you to several tax exemptions and benefits. You’ve heard the old saying, “It’s not how much you make, it’s how much you keep.” If you’ve been paying taxes for long you know the truth of that statement. Real estate offers numerous tax benefits for owners in the form of cost segregation and depreciation. Deductions on interest, rental income, property taxes, and more are possible.
- Its Value Increases Over Time
Unlike stocks and bonds, real estate holds its value. Though property values ebb and flow, the longer you hold on to your land or buildings, the more valuable they will become. History supports this fact. As Mark Twain said, “Buy land. They’re not making it anymore.”
- It’s Easy to Get Started
When making traditional investments, like stocks and bonds, you’ll need money upfront. With real estate investing, there’s more flexibility when it comes to funding. There are multiple way to finance a real estate purchase: cash, angel investors, mortgage loans, or private lenders. With that many options available, it’s a matter of choosing the one that is best for your financial situation.
- More Stable than the Stock Market
Real estate investments are less volatile than stocks or bonds. That means they’re not as likely to shift unpredictably like traditional investments can. Since the market is more consistent, investors can enjoy more stable costs and relatively smooth returns.
- You Have More Control
When you invest in things like stocks and bonds, your success is dependent on factors that are completely out of your control. You can choose when to buy and sell, but that is pretty much the only options you have. It’s possible for your investment to disappear overnight. Real estate doesn’t tie up a lot of your cash, and you have several options at your disposal. With real estate you can rent it, flip it, rehab it, refinance it, and more! Typically, the only people who lose money in real estate are those who buy and sell at the wrong times.
As you can see, there are many reasons to invest in real estate. If any of the reasons listed here resonate with you, it may be time to consider the opportunities that await you. Take note of the many benefits of investing in real estate, and set yourself up for financial success.
I have been investing in real estate for nearly 20 years and have experience with many different types of real estate deals. If you are interesting in learning more, reach out and I would love to share more details with you. Find me on Facebook (Investor Smarts) or send me an email (Candice@cbfteam.ca).
