Pros Of Investing In Real Estate

If you notice only 5 percent North Americans are financially independent till they reach retirement age

. Remaining 95 percent are independent on friends and families to fulfill their needs. If you dont want to face problems in your retirement age the best solution would be to invest in real estate. If you invest in real estate in a right way, it can be very profitable and an exciting adventure, but if you do it wrong, you may end up with a huge mess. Some major advantages of investing in real estate are as follows:

Appreciation:

By investing in real estate you will notice that their will be a steady increase in the value of your house or land. This appreciation is due to overwhelming demand for real estate. One of the main reasons for investing in real estate is to satisfy basic human need i.e. shelter.

Leverage:

Leverage the use of borrowed funds to finance the purchase of asset leverage basically allows you to use other peoples money to buy more properties. Leverage allows investors to earn a higher return on their equity. Make this kind of purchase with the help of your companys 401 (k) program or buying stocks in the stock market.

Tax savings:

If you buy right property at the right time at a good price and manage it properly and also your rental properties generate a positive cash flow you can take advantage of tax write offs including depreciation. For example: if your property generates $1000 a month and positive before tax cash flow you would pocket $12,000 a year. Also assume if your depreciation amount is nearly $15,000 the same year. You can get double benefits, you can show a paper loss of nearly $3000 and you can avoid paying taxes on the $12,000 gain for that year.

Freedom:

If you invest in real estate you require less commitment when compared to other business. If you invested in a software company, consulting firm, coffee shop or bakery you have to spend long hours to achieve success. Real estate investing can be done without too much interference with your current job.

Most of the real estate work is done in the beginning when doing research and property selection. Once you have purchased a house or apartment, you just have to just call property Management Company.

Pride of Ownership:

One important aspect of real estate investing is that you should physically own a building and are responsible for peoples shelter. Unlike owning a stock, whose value may decrease if stock market crashes, real estate investment may make you happy as the value of property will only increase and you can physically go stand in front of and look at and say this is yours.

One major advantage of investing in real estate is it is easy to conclude that very few if any other investments can match it.

by: Jeff Adams

POST COMMENT

High Profile Realty: High-end Real Estate Is Indian Real Estate In Boom Or Decline? Repos Condo: Guidelines To Savings Buying Properties At Auction In Alabama Santa Cruz Mls Listings: Inexpensive Estate Offers In Search Of Reo, Short Sale Or Foreclosure "deals" Property Auctions Are Beneficiary For A Sale Of A Property What Is A Short Sale And Is It A Good Idea? Commercial Doom And Gloom Features And Benefits Of Short Term Letting Investments Growing Attraction Of Long Term Lettings What You Should Know Before Buying A Foreclosed Home Real Estate Market In India