A house is not just a place to live, it is an investment opportunity, too. This article will explore the three main reasons why so many people are choosing to own their own homes as opposed to renting them. Companies such as Bigos Management are making this easy in areas such as Minnesota.
Less Risky
Investing in real estate is a less risky prospect because it is not affected by the kinds of short-term fluctuations that are experienced by those investing in the stock market. Share prices will invariably go down as well as up and a great deal of money can be lost from choosing the wrong companies to invest in. Whereas, with real estate, there is always a tangible property to fall back on, which can be further developed to add value that will compensate for any changes to circumstances areas could potentially suffer economically. This is something, though, that a real estate adviser can help with. They can let you know which areas are the most desirable to live in economically with regards to work and education. Growing economies such as that in Minnesota make it a good place to invest in real estate as the indications are house prices can only rise. As the University of Minnesota and Carleton College have improved education there, more people are seen to be renting properties in Minnesota. The knock-on effect of this is that more will want to buy properties there, too. It is always a good idea to invest in somewhere that is growing, rather than somewhere that property prices have already peaked in the short term. Although, long term, house prices by tradition continue to rise.
Better Long-Term Investment
With real estate, there is a proven record of house prices increasing over time. In addition, of course, you still have the tangible asset of a roof over your head or someone else’s to sell, should you need to liquidate your assets. In the meantime, an income could be earned from a property in the form of rent. As a property expert like Lincoln Frost will likely attest to, land, which is a part of real estate, is a desirable asset to own. Particularly when permissions have been granted for further development in the future to extend the property’s use. Extensive land is useful when buying a ranch as it allows for more cattle to be housed and more profit to be made. Other businesses can potentially be run from properties. Or simply it can be a home in the idyllic countryside where everyone can relax, knowing that they have a nice view to look at and an asset that odds on is increasing in value for the future.
Tax Incentives
Tax deductions, for instance, exist for landlords owning real estate. The repairs on a property, which are also to the long-term benefit of the owner, can be set against tax. Any repairs can only add value to a property for when it is potentially re-sold in the future. Taxes are high enough, so it is never a bad thing to have a way of reducing them. A real estate management company, such as the one referred to above, can assist you in the kinds of tax incentives that you can expect from a real estate portfolio.
So, some reasons to invest in real estate. It is hard to think of any reasons not to. It can be viewed as a good way to make money work for you, rather than leave it sitting in a financial institution earning very little interest at times when interest rates are low. In addition, you may not just be putting a roof over your head but another family’s, too. A family perhaps not as fortunate as you in being able to financially afford to buy a second, or even third property, to rent out.
For some more reasons to invest in real estate, you may also find the attached article of interest.
Veeramachineni Lalitha
I am Finance Content Writer. I write Personal Finance, banking, investment, and insurance related content for top clients including Kotak Mahindra Bank, Edelweiss, ICICI BANK and IDFC FIRST Bank. My experience details : Linkedin