Why real estate is the safest option ?.“Real Estate can neither be lost or stolen nor be carried away, purchased with common- sense, paid for in full, and managed with reasonable care, it’s about the safest investment in the world” – Franklin D Roosevelt
Investing in real estate automatically means investing in land as well. Actually land can be quite a big chunk of your real estate investment, sometimes reaching well beyond 50% of the total amount. The best quality of land from a real estate investor’s point of view is that it is a limited resource. There is no way to make more land that what is already available. This means that the price of land is set to keep going up indefinitely into the future, regardless of the general economic conditions. As a result, the total value of your real estate investment will also continue increasing in the long term. In addition, you can always use the land on which your income property is built to build a new, bigger property, which will generate more rental income for you; for example, you can replace a single-family property with a multi-family home. Last but not least, you can always leave land as inheritance for your children and grandchildren. So, the first reason why real estate is the best investment is because a large portion of it is investing in land, which is extremely safe. #Why real estate is the safest option
Real estate markets are relatively stable – Why real estate is the safest option?
In comparison with stock markets, real estate markets are quite stable. Stock markets are highly volatile, which means that you can make lots of money or alternatively lose lots of money within a few days or even hours. While the real estate market is also subject to some volatility, it is significantly less than in the case of stocks. This means that there is less risk associated with investing in real estate, which makes this type of investment safer. And safer investments are better investments. So, that’s why real estate is the best investment possible.
Real estate values tend to barely outpace inflation. However, there are a few reasons why real estate investing tends to do better.
The first reason is leverage. Unlike stocks, where it’s irresponsible to invest with borrowed money, you can use significant amounts of financing when investing in real estate without adding a ton of risk. Lenders typically finance investment properties with down payments of just 20–25% of the sale price. When buying a primary home.
The second reason why investing in real estate can produce strong returns is that investment properties can be rented out to generate passive income. Renting out investment properties is one of the best ways to earn passive income in real estate. To give a personal example, I recently bought a triplex as an investment property. It would be nice if the property value went up over time. But the primary driver of my returns is likely to be the rental income collected from the three apartments.
Finally, real estate investors enjoy tax advantages that stock investors don’t. For example, when you buy an investment property, you get to write off the purchase price over a certain number of years — a tax deduction known as depreciation. It would be awesome if you could write off your stock investment in a similar manner, but that isn’t the case.
The two most important features of any sort of investment are profitability and riskiness. Investing is real estate is an excellent choice for capitalizing on your money because it promises great return and because it is the safest investment strategy, real estate is the best investment option.
#why real estate is the safest option #why_real_estate_is_the_safest_option