To acquire or grow wealth, you must invest. It allows you to put your money to work in all sorts of vehicles, ones that can earn strong returns. If you do not, you’re losing out on opportunities to grow your financial worth. Not only that, but on opportunities to save up for retirement, support others, and become a part of an exciting new venture.
Laymen say – isn’t investing just gambling? Well, it’s safe gambling. You make decisions based on past trends, statistical data, and forecasts. It’s not like you’re playing online casino games. Though doing so can also be lucrative, as some slot games offer progressive jackpots in the millions, and those that don’t, provide wins a thousand times your bet. The level of variety when it comes to these games is terrific, and so are the perks online casinos give out. VIP clubs, free spins, all kinds of promotions, and tons of other casino bonuses are available once you register.
Thus, maybe it’s not a bad idea to invest in gambling stocks. Perhaps, but we’re here to talk about why it is a good idea to put your money in real estate. So, here are a few reasons.
You Can Leverage It
Leverage means that you pay for something without coming up with its full cost. In terms of Real Estate, it means you can use leverage via a mortgage. You put down a fraction of the purchase price, but you can reap benefits, keeping what income the property generates, and you get to utilize tax write-offs. You cannot do this with other investments.
It Provides Steady Income
We’re all familiar with the concept of paying rent. It’s good to save up money, but what’s better is if you can save and earn interest. Real estate can do this for you if you find a property in a flourishing area, or in one where you’re sure that the price won’t drop. Thus, your initial investment stays safe as you earn money from rent. If the area develops, you can charge more rent, and save up for renovations.
Saving money which is then re-invested into your property will undoubtedly increase your income in the future and thus, allow you to be more successful. Just remember, this does not happen overnight. It takes a lot of time and planning.
Real Estate is Improvable
Speaking of renovations. One of the unique advantages of real estate investing is that properties are improvable. Your investment is made up of tangible assets, materials. You can improve the value of any property with adequate refurbishments, which can be cosmetic, structural, or both. You’ve likely heard of the term house flipping. An investor buys a house at a lower price in a good location, fixes it up, then sells it at a higher markup.
It is Tax-Deductible
Always keep an eye out for tax reform. Tax codes in many areas allow various deductions for expenses incurred in owning a piece of real estate. These can include maintenance, property upkeep, interest paid on a mortgage, and more. Usually, you cannot deduct taxes for rental, taxes you paid for someone else, or for something you do not own, transfer taxes on the sale of a house, and more. Still, what you can deduct can offset income and reduce your overall taxes.