So, you want to add a new venture to your investment portfolio but you’re curious if real estate investing is the best option for you? With the right course of action, real estate investing is a relatively safe investment that can wind up making you great returns and here’s why you might want to consider getting involved!
Real Estate Investing a Relatively Safe Bet: Unlike with the unexpected rising and falling of stocks, you have a lot more security in investing in property. In the current market, you can count on your property to appreciate in value over time due to the high demand for housing and low supply. This also means a steady influx of tenants looking to rent! At the same time, you can diversify your investment portfolio with an added asset that has lower volatility with a solid chance of return. Though keep in mind, returns do vary based on a number of factors including, location, demand, property, etc.
Cash Flow: The amount you bring in every month after you’ve paid all your expenses is considered your cash flow. If you’ve invested in a good property in a well sought after location, chances are you’ll have no trouble finding tenants and can therefore rely on bringing in a steady rental income. This also means you can pay off your mortgage sooner and build more equity!
Better Financing: Another benefit to investing in real estate is the financing potential that comes with lower interest rates, in comparison to that of stocks. Baring in mind that your credit score should also be in decent standing, financial institutions can loan you up to 95% of your property’s value and will often do so because real estate is a concrete investment and an asset that tends to increase its value over time. This makes for excellent collateral and also an easier ability to borrow funding for your investment.
More Control Over Your Investment: One of the key benefits to investing in real estate is you can call the shots and don’t have to rely on third party managers to handle your portfolio. As the key manager of your investment, you get to decide how many stakes you are willing to put in to grow your investment and get the most out of your return. Whether that be flipping or renting out a property, making upgrades to the property or getting to set your own terms in regards to rental agreements, etc. It’s completely up to you!
Now that you’re aware of some of the perks associated with real estate investing, it’s time to start researching the process and deciding if you’re ready to take on this endeavour. Remember that with any investment, there are always risks, and it takes a great deal of hard work and know how to see a return on your investment. But with patience and keen business savvy, you can start seeing reasonable results on this long-term investment over time!
