There is a reason why there are several shows about real estate on TV. It is a popular investment, and for a good reason. Here are six reasons why you should invest in real estate.
1. Invest in A Tangible Asset
Real estate, such as real estate in Calgary, has long been seen as an investment that provides a tangibility not offered by other types of investments. Essentially, when you buy a property and rent it out, you buy the bricks and mortar that comprise the building and renting them to someone else. You can walk around your property to inspect it at any time, and because you own it outright, there’s no lender to worry about if something goes wrong.
2. Invest in Something Established
Another benefit of real estate is the fact that it’s an established asset class. When you invest, particularly if you want to take your money and go on vacation someday, you want something with a proven history and path to continued growth that can ensure your ability to enjoy life after investing. That doesn’t mean that other types of investments aren’t viable, but it’s helpful in a world of unknowns to know that real estate has been a consistently profitable asset for decades.
3. Leverage Your Money
Real estate investing offers the opportunity for leverage, which is another thing that popular TV shows have driven into our heads. You can invest little to nothing of your own money in buying real estate and put down as little as 50% on the property. Then, you can borrow the rest of the money from a lender or investors to fund not only your purchase but also repairs or renovations. You could have picked up that run-down house for next to nothing, making it easier to turn a profit once you’ve fixed it.
4. Reap Tax Benefits
Speaking of profit, the money you make when selling a property can offset your taxes. The more money you make, the more beneficial it is for you, which is why real estate has a notorious appeal among investors – people like to keep their earnings.
Real estate is a good investment because it tends to increase in value over time. Because there are millions of people out there who need a place to live and lots of properties that they can choose from (so the supply is somewhat limited), property that isn’t necessarily located in an optimal location can still be very desirable and sell for a premium.
6. You Can Use It as A Tax Write-Off
Finally, real estate is one of those investments that you can use as a tax deduction. If you own property and rent it out, all of your expenses related to the home are deductible from your taxes. Not only does this reduce what you owe Uncle Sam, but it also helps you keep more of your money in your hands.
These are some of the benefits of real estate investing. Not only is this an excellent way to make money on top of what you already have, but it can be a valuable way to diversify your portfolio and provide for more excellent opportunities when you want to live off the income you make from your investment or want to pass it on to your family.