Is Real Estate Still a Good Investment?

The biggest question to ask yourself when deciding whether or not you’re ready to start investing in real estate is: can I afford it? There are pros and cons to real estate investing. But, if you have the right information, it could be a great long-term investment and can help you to begin building wealth. 

There are a few reasons why Real Estate Is a Good Investment: 

• You benefit from the natural appreciation of property. On average, real estate appreciated 3% a year without any extraordinary fixes to the home. If you decide to put more sweat equity into your property, your appreciation will be even greater than the average. 
• Investing in real estate is a business, and like any business owner, you can take advantage of many tax write-offs. Since you own the home and rent it out-- that is your business, you are the landlord.
• Investing in real estate can also lead to a more financial peace of mind, when you take the right steps to afford this investment. Once you have created a budget and feel secure with what you are investing in, you hold on to that asset. Many people feel more secure knowing all their money isn’t liquid. And, if income producing, would be a great legacy to pass down to your future generations.
  

Investing in real estate is no small feat. There is a significant amount of money up front to even begin the process. There are also ongoing maintenance costs and income gaps if you are between tenants for a period of time. 

There are also a few items you should consider:

• To mitigate some of the debt that could be incurred when investing in real estate, try and either purchase with cash, or be able to afford the mortgage payments without the rental income. This is important to factor in because your investment property could lead to being more of a financial burden. 
• A great way to start in investment real estate is to purchase a duplex or a house with a basement apartment that allows you to rent out one unit and live in the other. Just keep in mind that you will be in the same building as the individual renting from you.
• Before you buy, you should always conduct a thorough amount of research. If you are buying land, ensure that you research the land deed, how future building will affect your property value, and what kind of a neighborhood the property is in. These factors can dictate the appreciation of your property.

Overall, if you set yourself up for success, the home, apartment complex, or piece of land can be much more attainable than you would have originally imagined.