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5 Reasons Why You Should Consider Investing in Real Estate


5 Reasons Why You Should Consider Investing in Real Estate

You’ve received the advice before:  “You really ought to invest in some real estate.” “There’s never been a better time to invest.” Yes, it all sounds good and you have thought about it. But, you know that the market dropped in 2008, so it’s only natural that you might have a reservation or two about the idea of investing.

The truth is, there are a lot of good reasons to make an investment in real estate. Here are five things to consider:

1. Taxes – Yes, taxes are a sure thing whether you decide to invest in real estate or not. But, did you know that those who choose to buy investment properties actually are able to keep more of their paychecks? Yep, the deductions start with anything incurred during the purchase of the property and continue with maintenance, depreciation, loan interest, insurance premiums… the list goes on. So, maybe you don’t have to share so much of that paycheck with Uncle Sam after all.

2. Equity – It’s very likely that you will build equity as you’re paying down a mortgage. With each payment you make, you’re getting closer to paying off that principal. Once the property is paid down or off, your earning potential only rises.

3. Cash Flow – Speaking of earning, did you know that investing in real estate can take you down the path to financial freedom faster than just about anything short of hitting the Powerball jackpot? It’s true – when you’ve got positive cash flow, well, you’ve got positive cash flow. Even in the event that you’re spending more than you’re bringing in, you are able to write that off as a loss (see reason #1 to invest in real estate).

4. Leverage – Ah yes, spending a little of your own money and (potentially) a lot of someone else’s to make more money for yourself.  Sounds like a no brainer, right? You have X amount of dollars to spend – you can leverage some or all of that to buy one, two or however many properties you can. If you’re borrowing at 4%, but your return is 4 times that, you’ve got positive cash flow. If you have tenants who are taking care of your mortgage payments, your return goes up. Let’s not forget the end of that loan term, either. You own one, two or however many properties you’ve bought and you continue to receive rent payments. So, yes, leverage = buying power = earning power.

5. The 3 P’s – Pride. Peace of Mind. Protection. – When you invest in real estate, you can enjoy the pride that comes along with home ownership. If you’re investing in a home for the future – maybe for your children or parents, you have the peace of mind in knowing they’ll always have a place of their own to call “home.” Finally, protection or security – the financial kind. Let’s be honest, it’s something we’re all looking for.

If those five reasons have got you thinking about investing in real estate, get started by reading more about The Art of Real Estate Investing or contact one of our Real Estate Investment Specialists.