35 Reasons To Invest In Property: Why Not Start Now
Investing in real estate and properties has gained a lot of interest. There is no doubt that this is one of the best ways to earn money in the long term and build solid wealth. If you are interested in investing in property, we will show you the best reasons why you should start right now.
Reasons to invest in properties
Investing in property has been ranked as one of the best investments of all time. No matter where you are, how much money you have, or what country you live in, there will always be a safe way to invest in real estate and make your money work for you.
We show you why to invest in properties and why you should start :
Investing in property is safe
In the world of real estate investments, the phrase is used: “safe as houses”. This phrase is the main reason to invest in property.
According to a study conducted in the United States, properties have increased in value at an above-market rate since 1926 – an estimated 11.4% per year – despite wars, disasters, recessions, and crises.
So it is not easy to determine why investing in property is safe: your capital is always guaranteed to a property that sooner or later you can sell for a profit.
Also, unlike stocks or investing in the stock market, the risk is mitigated by the value of the property, therefore it is considered a safer investment.
It’s easier to get started
You do not need to have special knowledge or complete a university degree to start investing in a property. Many successful property investors did not start as real estate experts.
Many of them only bought houses to be able to live in them, benefiting from an easy real estate investment. Later they realized that the value of the house increased – and that motivated them to invest proactively.
It’s easier than investing in stocks
Learning to invest in the stock market usually requires a lot of education. You have to understand how the system works, understand how to buy worthwhile stocks, as well as find the best stock broker or mutual fund manager.
Once you have done this, you will have to research the company’s shares in the market, which involves reading annual reports, financial press conferences, and other news.
However, investing in property is much simpler. You do not need to be a real estate agent. To get started, you just need to go online and start looking for properties.
Although it is more complicated than just choosing a property, investing in property is much easier than other types of investment. Also, it can be much more entertaining and satisfying than just seeing the numbers on a screen.
Investing in property is good business
You may not feel it when you’re applying for a mortgage, but investing in property is good business. And getting started is easier than you think!
Home loans are the biggest part of a bank’s business model, and lenders are more likely to accept a deal when it comes to property than any other asset, including commercial property.
This makes it easier to invest in property than in any other type of asset.
You can use the leverage
By investing in real estate you can use other people’s money to double your money. How is it achieved? Thanks to leverage.
It’s simple: you can use your property to guarantee a loan approval and turn that money into more money.
Lenders will give you up to 95% of the property’s value, which you simply cannot achieve by investing in stocks.
This great lending power allows you to benefit from the capital growth of a larger asset and build a much larger estate.
There are different investment methods
Contrary to what many people believe, property is a flexible investment: no matter your financial aspirations, you can find an investment strategy that you like.
Some ways to invest in property are:
- Long-Term Value Growth
- The Easiest Way to Invest in Property: Looking to build a retirement fund or save for retirement? You just buy a property, you live in it and over time you collect your earnings.
- Increased Cash Flow
- Need cash? You can choose to rent out part of your home (using a site like Airbnb) or you can invest in apartments for rent. This extra money can help you in any phase of your life.
- Buy and renovate
- Did you see an old property that has potential? You can renew, subdivide or develop it. Unlike other types of assets, you can multiply your home’s value by doing simple things like a simple paint job.
There are so many ways to invest in property that you will always find an opportunity to make money.
You have 100% control over your investment
If you invest in the stock market, you will typically need to hire a stockbroker to take care of the business for you. You will also depend on market conditions and the people who are in charge of managing that company, which can cause uncertainty.
When investing in property this is very different: once you have everything arranged, you have direct control of the property or real estate (assuming you can keep the mortgage payments, and everything within the law).
This gives you 100% control over your investment, as it means you can directly influence asset value and cash flow, something that is almost impossible to achieve when investing in stocks.
You can renew and multiply your investment
No matter if you want to invest in properties in Miami, New York, Spain, or anywhere on the planet, you can always do something to improve the value of your property.
One of the most common strategies is cosmetic renovations: buying a neglected property and improving both the interior and exterior. This can range from a simple paint job and new carpeting to renovating bathrooms, kitchens, and landscaping.
It is a tried and true method of increasing a property’s value and it is not difficult to multiply your money by choosing the right property.
You can subdivide and rent
Finding a property on a large piece of land in a good area location, you can split the property in two and sell one or both halves for a nice profit.
This allows you to invest in properties in a flexible way and scale your budget in a better way.
You can develop a piece of land
The best way to make money when investing in property is to take an existing property or vacant piece of land, subdivide it, and build on it (usually by converting it into apartments or townhouses ). The gains can be substantial if you do it right.
Buying a property and developing it can bring massive profits. These types of opportunities cannot be found with other assets.
You can invest in property without money
If you are looking to invest in properties and you do not have money, you will surely find an option to achieve it.
Although you must be patient, you can grow your investment and make a profit, even if you start with a small property. It’s also relatively easy to get approved for a loan, so you don’t need to have money to invest.
Good luck getting a loan approved by a bank to start a business or borrow money to invest in stocks!
You can negotiate your own price
If you buy a stock, you buy it at the market price at that time: there is no room for negotiation. In the property market, the opposite is true: buying and selling is about negotiation.
You can convince a motivated seller or buyer to buy a property at a lower price. This represents a great investment opportunity: the urgent sale or sale due to the divorce of a person turns into great profits for you.
It teaches you to save money
The simple act of saving for a down payment when buying a home teaches you financial discipline, working with numbers, and knowing how to invest in property. After purchasing the property, managing it will improve your money skills and give you more control over your money.
You get tax benefits
One of the most important benefits when investing in property is that you can save on taxes by deducting investment expenses from your property. It doesn’t matter if it’s a home or commercial property, you can legally pay less in taxes and use these savings to make more money.
Depreciation Benefits
Are you afraid that your property will lose value? You can reduce the risk of your loss when paying taxes.
By investing in real estate you benefit from the depreciation or loss of value of the property over the years. Depending on the age of the property and whether it has been renovated, this loss can be up to thousands of dollars each year. Fortunately, you can use this loss to your advantage.
You win when your properties go up in price
Depending on the country where you want to invest, you can also save on taxes and get more profit when you sell the property.
For example, when investing in property in the United States: if you sell your house, you do not have to pay any tax on the gain; whereas, if you sell a property in which you invested and that you have held for more than 12 months, you only pay taxes on half of the gain.
You can hire someone to take care of your investment
Do you want to invest in properties for rent in Miami, but do you live in Colombia? You don’t have to be there to take care of your property. You can benefit from growing up in another city without having to leave your home.
This is one of the most appreciated benefits of investing in property: the flexibility of living anywhere in the world and being able to earn money with properties in another country.
It is easier to recover if things go wrong
Are you terrified of the risk of losing your money? Investing in property is good business because it allows you to reduce your losses.
It is very rare for a lender to increase the cost of your mortgage, regardless of the state of the economy. Also, if the property falls in value, the payments to the bank will be for the same amount, which will benefit you when the property goes up in value again.
It is an asset that you can use
Regardless of whether you want to invest in property or not, your property will always be yours. So if something negative happens in the economy or a situation that changes your life, you can always move to that property.
This represents both long-term and short-term gains, as you can invest in rental property, live in it in bad economic times, and when things change again, you can use it again, leaving your investment intact.
They are not just investors in the market
An important factor in the robustness of the property market is the fact that it is not just investors trying to sell and buy properties – in fact, investors are in the minority.
Investors only have 30% of the mortgages in this market, while the other 70% belong to homeowners. This means that you will always have a market willing to buy your property.
As long as people choose to live in houses, units, and apartments, residential property will always be stable. From a young couple who saved enough money, to an investor looking to make money through this property market.
Demand is outpacing supply
There is a continuous demand for properties, both rental properties and properties to buy. The world’s population continues to grow at a robust scale – and housing supplies are holding steady in many market areas (particularly capital cities and areas affected by resource explosions).
This gives another advantage when investing in real estate, making it highly unlikely that prices will drop in the future.
You can weather an economic downturn
Unlike the economic recession of 2008, governments have created stricter laws to regulate property lending, making it less likely that a recession will affect property prices.
In either case, a good property can also offer immunity against an economic downturn. Although it will probably be a bit more difficult to sell, you can more than recoup your investment if you choose a good property.
Other people pay for your investment
If you qualify for a loan to buy a home or property and rent it out, you can use other people’s money to pay for your investment. This is a benefit you can only get from investing in property, and one of the reasons real estate is such a good deal.
It is a very rewarding passive investment
Can it be said that investing in property is a passive way of earning money? Of course! Your property continues to work for you no matter what you do. Do you want to invest in real estate, but don’t want to quit your career? You can do it without leaving your job.
Also, you can continue to grow your investment passively by paying a worker to improve your property. Although this will reduce your earnings, it is a passive way to increase your investments.
The value of your property increases, even when you retire
Many investors who follow the buy, renovate and rent strategy are building a nest for when it comes time to retire.
However, what many investors forget is that even after retiring for, say, 20 years after buying, property values continue to improve – making your investments worth more each year.
This makes it possible for you to live off your properties in 2 ways: by renting them out and getting a monthly cash flow, and by selling them for a big profit.
It is a stable investment
The property market is usually less volatile than the stock market or the stock market, at least in part because of the effort required to purchase a property.
This means by investing in property you are less likely to lose money due to the speculation of others. Thanks to the relative amount of time it takes to liquidate a property asset, you also reduce volatility.
It is a tangible investment
Another good idea to invest in property is that you own something tangible, something that you can see and touch.
Real estate is one of the few investments that you can see and feel, and sometimes this makes it feel more real, you can take your friends on a tour of your portfolio of properties.
The government has your back
The government has increased its efforts in recent years to keep house prices strong. Why? because these properties have voters.
Even in the last financial crisis, the government had to create ways to help homeowners pay their mortgages and prevent them from defaulting. This did not happen with other investments such as stocks.
The world economy is better than ever
The world economy has never had such good prospects as now. The world population is expected to continue to grow at a steady rate and all these people will need houses to live. This makes investing in property a great opportunity this year.
Regardless of your investment strategy or whether you want to own residential or commercial property, the economic forecast is in your favor.
You benefit from the expenses of others
Often companies or the government spend money to improve the infrastructure. A new form of transportation like highways, rails, or airports can increase property values and put other people’s money to work for you.
An investment project, such as a new university, hospital, mall, convention center, stadium, or more, can provide employment opportunities and increase the demand for homes in your area.
These new amenities can also cause home prices to rise, just because an area becomes better for living. Best of all, you get these benefits without spending a dime.
You get incentives from the government
Apart from getting tax benefits, when you invest in property or become a homeowner, in many cases the government will also give you money to buy certain properties.
For example, in the United States, the government gives credit of around $5,000 to people who buy a house for the first time. Can you find any investments that the government pays you to invest in?
It has never been so easy to find tenants
When investing in rental properties, a vacant property is a property that does not make money. However, finding tenants has never been easier thanks to classified sites like Craigslist or vacation rental sites like Airbnb.
Are you worried about the risk of renting a house without knowing the tenant? You can run a background check on a tenant in just minutes and decide if they’re a good fit for your property.
You can pass it on to your children
When you think long-term with your investment, you don’t just have to think about your lifetime, you can also think about your children. By investing in real estate or real estate, you can pass your investments on to your children before or after you die.
You can indeed do this with other investments too, but how many companies are still on top after 30 years? Not many. On the other hand, a property in a good area will continue to grow in the long term.
You don’t have to work if you don’t want to
If the idea of researching, renovating, developing, dealing with tenants, or any other associated tasks that come with investing in a property doesn’t appeal to you, then you don’t have to do them.
The property industry is very well established, and you can assign almost any task to an enthusiastic and competent service provider such as buying agents, builders, property managers, and more.
Yes, it will cost you money – but the best providers also provide a competitive advantage that can greatly increase your profits.
You can work if you want
On the other hand, if you prefer to do it yourself and take care of buying, repairing, and maintaining your properties, then there is no stopping you.
Since you are in control of your investment, you can be as involved as you want. Our point is: it does not matter if you want to do it or not, when investing in properties you have the option to modify your investment to suit you.
How to invest in properties: Opinions
We hope our guide on why to invest in property helps you get all the details to get started and take advantage of this income-generating opportunity. Remember that if you have any doubts or questions, you can leave us a comment and we will help you solve your concern.
Why is investing in property a good business? What are the advantages of investing in real estate? We want to know your opinion. If you have had any experience investing in property or tips for investing in real estate, leave us a comment below and tell us your anecdote.
