July 13, 2024


Mad about real estate

The Pros and Cons of Property Investment Buying

Property investment buying offers a solution to those people who want to spend their money on something worthy. By investing in real estate, you can gain bigger profits without having the need to face big risks. Because of this, various data showed that many people have been buying investment properties over the years.

Compared to spending your money on other forms of investment, buying real estate has many advantages. One of them is that prices of properties are relatively stable compared to stock prices. You don’t have to worry about losing all your capital in one go.

Although dabbling at the stock market has higher profit yields, investing in stocks can be quite risky. Stock prices are usually volatile and they fluctuate with the minutest change in a country’s economic, social, and political sectors. In addition, they go up and down by the day so you really have to watch your timing when investing in the stock exchange.

Real estate investingcan also provide you with a stable and steady income. For instance, a real estate investor can have a continuous source of cash if he will rent out an investment property that he bought. He can also collect bigger rent if he will improve and upgrade the property’s features and appearance.

Another advantage of property investment buying is that it can offer you capital growth. You earn money as the real estate assets you own grow in value and according to analysts, prices of properties usually double up in every seven years. So if you’re going to purchase an investment property today, where the prices of real estate are considerably lower because of the recent housing bubble and the ongoing financial downturn, you might be able to earn twice the amount of money you spent on buying the property or more.

You can also receive tax benefits when you invest in real estate. The expenses you incurred by keeping a property, such as repairs and maintenance, the interests on a loan, and agent’s fees, are considered tax deductibles. The depreciation on the property can be also claimed as deductibles on your tax returns.

However, a known disadvantage of real estate investing is that home prices could remain stagnant for a number of years. They could also depreciate because of circumstances beyond your control. Another drawback when going on a property investment buying spree is that you might be unable find tenants and the property could be vacant for a long period of time.

Meanwhile, if you want to learn more about property investment buying and real estate investing, visit REIWired.com, your best source of quality real estate articles, sound files, and videos.