Real estate is a great investment for many reasons. You can enjoy an excellent rate of returns, amazing tax advantages and leverage real estate to build your wealth. Here are the top five reasons why real estate is a great investment.
Real estate provides better returns than the stock market without as much volatility.
Historically in real estate, your risk of loss is minimized by the length of time you hold on to your property. When the market improves, so does the value of your land, and as a result, you build equity.. Real estate gives you more control of your investment because your property is a tangible asset that you can leverage to capitalize on numerous revenue streams, while enjoying capital appreciation.
Real estate has a high tangible asset value.
There will always be value in your land. Land owners insurance will protect your investment in real estate, so be sure to get the best policy available so your asset is protected in the worst-case scenario.
Real estate values will always increase over time
History continues to prove that the longer you hold onto your real estate, the more money you will make. Now, real estate investors in the top performing markets enjoy a windfall. When land becomes a demand it becomes your time for all the improvements become dependent on you. This increases your value and the value of the land.
An investment in real estate can also diversify your portfolio
If you've ever spoken to a financial planner about investing, then you are very aware of the importance of diversification. When you diversify your portfolio, you spread out the risk. Real estate will always serve as a safe tangible asset to mitigate the risk in your portfolio. Many have amassed wealth by solely investing in real estate.
Last but not least, real estate investing comes with numerous tax benefits.
You can get tax deductions on mortgage interest, cash flow from investment properties, operating expenses and costs, property taxes, insurance and depreciation (even if the property gains value) and other benefits. The end of the year is a very busy time for real estate because people want to take advantage of the numerous tax benefits before the end of the year.