Investing in real estate is generally considered one of the best ways to grow wealth. However, there are still risks and other factors to consider. But for many, it can always be the right time to invest in real estate with the right strategy and timing.
Instead of putting their money into depreciating things, most investors prefer to use those funds to buy a house or an apartment building. Why? Because real estate investment is one of the most stable forms of investing out there, where the early you invest, the better.
Why Is Real Estate Still The Best Investment?
Buying a property is still the best long-term investment for some. Owning a home means providing stability for yourself and your family. While a house's structure may not appreciate over time, the land it sits on will. In addition to that, owning a home means building equity in your property.
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What if you can't afford to buy a real estate property yet? There's still hope. People can now look into digital platforms that connect investors to top real estate investment companies and allow them to invest in those institutions for as little as USD$5000. This opportunity opens up a world of possibilities. It makes real estate investment accessible for people who want to invest in real estate but don't have enough money on their own.
The Current State Of The Housing Market
The housing market worldwide is generally edging up despite other negative speculation. In Canada, for example, according to the Canadian Real Estate Association, home sales have experienced an increase recently. If the numbers continue to climb, prices may rise too.
That's why the housing market's current state might be a perfect opportunity for those considering real estate investing. Plus, there's no denying the fact that even though there might be some minor turbulence, investment properties may still relatively be profitable for many.
5 Reasons Why Now Might Be A Good Time To Invest
Below are five reasons why now is a great time to invest in real estate.
1. Investment Property Provide Different Options
Unlike stocks and bonds, where your investment will entirely depend on the market you don't control and buying or selling are your only options, real estate offers you different options in terms of profits. For example, instead of waiting for years before they can cash out their investment, people can sell their homes or apartment buildings at any time for a profit. If the market value doesn't grow as expected, people can always find a tenant and collect rent until the market value increases.
Property owners may renovate their property or find ways to increase its value. It can be leased if the owner needs more cash but doesn't want to sell it. One can even live on the property or its part while they rent out the other parts. There are many different options on how to make a profit on a property you own. All you need is to be creative and have an effective negotiating strategy to get the highest profit.
2. Owning Is Better Than Renting
Think about the monthly expenses people pay just to rent their current place. Monthly rental for most cities is increasing every year. Yet, that money doesn't go into their home's equity or increase in value. Instead, it goes to the landlord who owns the property. That landlord might also probably have a mortgage they're paying off, but your rent is helping them pay off their mortgage. On the other hand, if you own a home or apartment building, you're the one collecting the rent. And, you're building equity in your home at the same time. So why rent when you can own?
3. Real Estate Values Continue To Appreciate
Over the past years, housing values have increased in most countries. Unlike other purchases such as cars that depreciate over time, homes increase in price each year. So, if you buy a house today, that same house might be worth more than what you paid for it in the future. People will always need shelter, which means houses or homes will always have value.
So as long as there is a demand for housing. Prices will continue to rise, and owning a house or apartment building provides value for years to come.
4. Receive Tax Benefits From Investment Properties
Investment properties are tax-deductible in many countries. That means the money you spend on necessary expenses for your property is tax-deductible and lowers your taxable income. For instance, if you pay a particular amount on your rental property to repair damage or maintain it, you can deduct that amount from your taxable income. Rental property earnings, as well as mortgage payments, are sometimes also tax-deductible. So, the early you invest in real estate, the more tax benefits you'll enjoy.
5. Save Your Hard-Earned Money From Inflation
Inflation can reduce the buying power of money over time. Inflation is when prices increase on goods and services while wages remain the same. For instance, say groceries cost $100 today. If inflation raises the price of groceries by 5%, then it'll cost you more than $100 to buy that same item next year. In other words, inflation reduces the value of money. However, if you invest in real estate and that market goes up by 5% the following year, you've increased your net worth by that same amount. In other words, real estate can be a hedge against inflation because you can sell it for more money than what you paid initially as long as the market appreciates.
Having a house or apartment building provides you with many opportunities as an investor. While the market rises, so does your net worth and monthly income. Real estate’s value is long-term in nature. While other investments might not provide you with yearly dividends, owning real estate provides you with several options to create additional streams of income. Depending on the investment, some property owners can even live on the part of their building rent-free. Just ensure you only invest in an area that's always sought after, such as those locations that are close to schools and other public amenities.
To explore real estate investment opportunities further, visit eXp Realty for a range of properties including condos in Plantation, Florida.
Ancillary reading: 8 Self-Employment Business Ideas & How to Get Started
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