Have you ever heard that 90% of millionaires invest/own real estate? Believe it or not, it’s true! There’s a reason the wealthiest people invest their money into real estate – but, like any investment, it does come with it’s pros and cons.
Let’s get to it. Today I’m going to walk you through a few of the pros and cons to owning real estate.
Let’s start with the good parts:
- Real estate is a great investment because it appreciates over time. While there are occasional market fluctuations, if you buy at the right time, the rate of appreciation generally far outpaces annual inflation.
- Becoming a homeowner has unique tax benefits that allow you to grow your wealth over time.
- Rental properties provide steady cash flow! Cash flow provides ongoing, monthly income that is mostly passive.
- Real estate builds equity. While your tenant is paying the monthly mortgage payment, your increasing your net worth and paying down an asset that you can continue to rent or eventually sell and make a profit
Now for the cons of owning real estate:
- Owning real estate requires money. You’ll need funds for a down payment, repairs, updates, as well as regular maintenance, expenses, insurance, and property taxes.
- There’s a learning curve that comes with owning real estate. It’s important to know which properties are good investments, and how to manage them after purchasing.
- Investing in real estate also comes with its own set of risks. Buying at the wrong time, increased liability, getting over-leveraged. You need to be able to make money at the end of your monthly payments, despite unforeseen issues or repairs that may arise.
A real estate investment is an amazing chance to provide steady cash flow, substantial appreciation, and tax advantages – making it a sound investment. Just make sure you’re ready to consider the important factors at play.
And as always, feel free to ask me any questions you may have! I’d love to help you find your next investment property.
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