“Real estate is an imperishable asset, ever increasing in value. It is the most solid security that human ingenuity has devised. It is the basis of all security and about the only indestructible security.”-Russel Sage
There has never been any doubt that real estate is one of the few things in the world that still remains as a great investment. Why? Well, for starters land is the only thing that the world does not make more of which means it is highly valuable. However, you should not make the mistake of thinking that a real estate investment would be an excellent avenue for your get-rich quick scheme. To succeed in real estate, you do not simply acquire condos for sale in Manila and expect to make a fortune within a fortnight. Success in this endeavor requires commitment, your dedication to hard work as well as your patience. You will encounter many failures that would test your resolve and at times, you might even feel like giving up. However, when done strategically and smartly, you will find that the monetary returns are beyond what you might have imagined. Financial freedom is very much possible with real estate investment, and if you can leverage it, you can build your wealth.
Apart from those, here are the top five reasons why it is considered a great investment:
- Real estate provides better returns than the stock market without as much volatility
Investments in real estate have always been seen as a calculated risk. However, this very same risk is mitigated by the length of time you hold on to your property. Should the market improve so would the value of your property and in this way, you build equity. In the stock market, the risk never quite changes and there are factors you cannot leverage and which could potentially impact your investments negatively. Real estate grants you more control over your investment as property has always been a tangible asset.
- An investment in real estate can diversify your portfolio
If you have ever heard the saying that you should never put all of your eggs in one basket, know that the same sentiment applies in investment. Financial planners would capitalize on the importance of diversification. This is because a diverse portfolio means a mitigated risk. Why? You have effectively spread it out. Real estate does not only serve as a tangible asset, but a safe one that would lessen the likelihood of financial risks as well.
- Real estate values will always increase over time
History has proven again and again that the longer you hold onto your real estate property, the more money you are likely to make. It has always been that the housing market has recovered tremendously from past catastrophic events that might have caused the property appreciation to slide. If you held on to your investments during those trying times, you can guarantee that appreciation would be back once prices have returned to normal.
- Real estate has a high tangible asset value
Land would always have value and there will always be value in your home. In a sense, this means real estate is tangible whereas stocks, which only have little to no tangible asset value can easily be worth nothing over time. New cars would not do you much good either as its value would likely decrease over time. If you wish to protect your investment adequately, ensure that you get yourself protected with home insurance that has enough coverage. Moreover, discuss with your insurer what the best policy available is for you so that your investment would always be protected and when the worse comes to worst, you have something to fall back to.
- It has numerous tax benefits
Mortgage interests make it possible for you to get tax deductions. Moreover, you get a positive cash flow from your investment properties as well as the operating expenses and costs. In fact, you might even want to take advantage of the numerous tax benefits before the end of the year to ensure you have adequate pecuniary returns.