Last year, RealtyShares conducted a survey to find out how much Americans actually knew about real estate investing. The result was that 40% of the people polled had no idea how much real estate returns on investment. If more people knew the benefits of owning a few properties, there may be more wealth to distribute within the economy. Purchasing property is a smart move, especially when it holds the promise of a continued payoff. Know the benefits of property purchases and long-term gain before hunting for that first investment plot, then find a few properties that will turn a healthy profit.
The guarantees of property
Real estate offers a better guarantee of profit than other types of investing, such as the stock market, bonds, or cryptocurrency. As long as rent is paid on each piece of property, expenses are covered, and the investment will be returned in as little as 30 years. This type of investment is also easier to calculate over the long term, as the total income will not be as affected by inflation as other types of investments. After the full amount of the initial price is paid off, the property offers nearly pure profit. The mortgages will be paid by the tenants, and insurance guarantees coverage if a tragedy strikes. The same cannot be said for investments such as stocks and bonds.
Investing in buildings or land also gives the purchaser more control than the stock market. When and where to buy or sell is up to the investor, not the stock market. As the year closes, a building owner is able to grab more tax deductions, grabbing funds from Uncle Sam to help pay down the initial investment. The obvious predictability and recession-proof benefits of property owning help an investor peek into the future with precision. Share markets cannot offer the same foresight; looking forward a few years into the housing market is far easier. Further, people will always need a place to live, so even a storefront with housing units attached will help a landlord ride out any economic downturn. The guarantee of property investment is the draw that offsets any possible negative aspects of being a landlord.
But can I get rich?
Yes, with some devotion and time. Owning real estate creates more highly rich people than any of the other asset types. The day of getting rich off the stock market is passing. Today is the day of owning property. Consider the number of people most recently made rich by different types of investing, and the facts stand for themselves. Fortune Magazine reports that 97% of the wealth is attributed in some way to property ownership. In fact, some property owners pay off investments early by budgeting incoming rent payments against the property. Charging more for rent than the monthly mortgage payment and investing in the property through repairs helps increase income while reducing mortgages faster. Further, this is one of the easiest assets to comprehend. There are no lengthy explanations needed to understand that a building is a building.
The necessary steps toward owning a property are clear when working with the right real estate agent, and the economic terms are also simple. The three most important terms to understand in this market are cash flow, yields, and capital growth. The toughest part of the process is understanding which mortgage works best, so hiring a broker is a wise choice. Between the simplicity of obtaining this type of investment and the fact that real estate has worked so well for others, it seems like a no-brainer to grab a piece of the property pie.
Getting started in the world of property-owning is intimidating, but worth the effort when it pays off in the future. Many property owners have been able to retire comfortably solely on their investment. There are a growing number of stock investors who cannot say the same. Owning, and renting, a building is the wave of the future. It is predictable, easy to plan, easy to buy or sell, and far less stressful than a fluctuating stock market. Find out how easy it is, then start researching lucrative properties for a secure future.