So you have some extra money lying around. You’re debating on whether to invest in real estate.
You know many people who’ve reaped success from real estate investment.
But you remember the miserable housing market in 2012.
The question is eating away at you: should you or shouldn’t you take the plunge?
While it’s no guarantee the market won’t decline, there will always be ups and downs.
The good news is, is that if you make the right investment you should still reap big benefits despite the current housing market.
Learn more about this, as well as other reasons why you should invest in real estate.
1. Home Value
Your rental property should increase no matter the current state of the housing market.
What people fail to look at is the long term versus short term investment.
If we look at short term, then yes the current housing market should concern us.
This is especially important if you’re interested in flipping homes.
However, like any market, the housing market goes up and down.
This means that should another 2012 (or 2008) happen, it won’t stay that way forever.
Even this was evident when the actual housing crisis happened. Now, a couple years later, the housing market increased.
It’s starting to become healthy again.
If you look at long term gain (meaning 30 years down the line), you should see an increase in profit after you sell.
On top of that, inflation rates are bound to increase over time.
So, while everything else costs more and more money, your real estate investment will remain the same. This is because it’s a fixed mortgage.
3. More Cash Flow
Cash flow is the extra money you have after you pay the bills.
You probably used some cash flow from your job or entrepreneurial success to pay for your real estate investment.
Now from this investment, your cash flow will grow even more.
Real estate is one of the only businesses where you don’t need to make deposits repeatedly.
This means, while you had to place a down payment for the property, your tenant is paying the mortgage.
You’re receiving cash flow without needing to invest more into it.
Think of it as a passive income.
4. Favorable Risk
Although there’s always some risk involved in business, real estate has a reputation for low risk and high reward.
That’s because it’s a fairly stable and predictable route.
It requires low liquidity, meaning it’s easy to get in and get out.
5. Teach Your Kids About Investment
This largely goes unnoticed but is very important.
Why not use your real estate investment as a teaching opportunity for your kids?
You could even use your real estate investment to pay off your child’s education.
Then, when it’s college time, your child could live at the rental property, and have property management duties.
A great teaching lesson for your child, and a nice deductible for you.
In fact, who knows?
That experience could set your child up to invest early. As the age old advice goes, invest early and often.
For more information about real estate investment, go to http://www.manausa.com/