5 Ways Real Estate is Your Smartest Investment

Investment trends change over time, but one thing is for certain: People will always need a place they can call home. Today, investors who want to make a lot of money can take this opportunity by meeting people's needs. Mortgage rates are now lower than ever, the values of properties around the country are still attractive, and many buyers are looking to purchase their dream home soon. For you to get started, you will need some money and good credit. According to AOL, one of the lessons most investors learned in the year 2008 is that real estate prices will not always go up. Therefore, having the stomach for risk is necessary.

Today, investors who want to make a lot of money can take this opportunity by meeting people's needs. Mortgage rates are now lower than ever, the values of properties around the country are still attractive, and many buyers are looking to purchase their dream home soon. For you to get started, you will need some money and good credit. According to AOL, one of the lessons most investors learned in the year 2008 is that real estate prices will not always go up.

Real estate investors enjoy several US Tax Code benefits. For example, the IRS allows real estate investors a 1031 provision; this means that after you have sold your property, you can invest your money again in the same industry without having to pay any taxes. You can also protect your investment from deductions that result from depreciation and interest on mortgages among many others.

Protect Your Funds from Inflation

According to The Wall Street Journal, inflation is bound to occur at one time or the other; especially, because of Donald Trump being elected as President of the United States.. By investing in real estate, you can protect your wealth from inflation, especially if your real estate investment generates income. However, this doesn't mean that you should only invest in rental properties. Historically, real estate investments have shown the highest levels of correlation to inflation than any other assets.

Some countries around the world tend to print more money to kick start their economies, and if you own income generating property, it can act as a shield against inflation. When inflation occurs, the real estate price, especially multi-tenant assets with a high ratio of replacement and labor costs, will also rise.

Source of Income

Although you will be responsible for addressing tenant issues, maintaining the property, and purchasing the best home insurance cover your real estate investment will be a source of income. This income will benefit you more when nearing retirement because you can continue collecting your income even after you have retired. Owning a property that generates income for you will also train you to save funds as you near retirement. You will also equip yourself with useful skills in the tenant screening process which can help you to choose only dedicated renters. According to Money.usnews.com, your real estate investment will not have good or bad days compared to the stock market.

Asset Appreciation

Purchasing power is affected in most cases due to inflation. However, a real estate investment that produces income will appreciate in value and exceed other types of investment. Generally, properties will increase in value as the operating income increases through rent and effective management of the property.

Less Risk

Investing in real estate has some risks and potential pitfalls. However, it is a less risky venture compared to other ventures such as stocks. Real estate ups and downs occur slowly compared to stocks. Stocks are more volatile and as they grow and dip so does your money. On the other hand, the value of your real estate property will increase, and you can get money from it, especially if you have renters that continue to pay you. You can also easily access bank loans as a real estate investor. Today, several online lenders can loan you wherever you are. Although most lenders have strict laws, especially due to the recession, a recent CashNetUSA review proved that customers did not have a problem taking a loan from them.

It is now obvious that real estate is the smartest investment available for you. You will invest in something visible and tangible, and that can grow and give a significant return on investment (ROI) over time. You can never go wrong by investing in real estate.