It is without a doubt that the best way to invest money is through real estate! Throughout the years, real estate has proved to make more money than any other working field. Despite this, many people remain uncertain as to whether or not they should enter the real estate investing world. They have this idea formed in their head that in order to start investing in real estate that, they should have some money in hand. This is definitely not true for many reasons. For one, you don’t need to have a lot of cash to invest in real estate. The only thing you do need is the ability to find money or find a strategy that can get you money. It doesn’t take a lot to start and once you do start in real estate, you’re going to make lots of profit. Let’s discuss why real estate is the best way to invest money. As always, feel free to leave your comments below and any remarks you may have.
Why is real estate the best way to invest money?
1. There are many ways to turn a profit with real estate
There are many reasons why investing in real estate is the best way to invest money compared to stocks. The only way you’re able to make money in stocks is if the stock appreciates in value while in real estate there are various ways to make money such as:
- Rental income: Rental income is essentially the main reason why investors choose real estate over any other type of investment. It is the main source that gets them money and gives them good returns when buying a rental property.
- Buying low: When you buy an investment property below market value you are instantly making a profit for yourself. There are different ways to buy under market value properties like foreclosures or short sales.
- Selling high: The cool thing about real estate is that you can play around with the price of the property, unlike stocks where you can only sell at market value. You can make a profit if you sell high.
- Increasing equity: In real estate, if you take out a mortgage to finance your property, you automatically increase your equity with every mortgage payment you put down.
- Tax benefits on interest: Depending on your country of residence, you can often deduce the mortgage interest from the rental income and create a tax-free profit.
2. You don’t need credit or a significant amount of capital
As I said before, you don’t need a lot of money or even good credit to invest in real estate. Believe it or not, many of the great investors you see today started off in real estate with little money in hand. There are various ways to invest in real estate. All you need is a little commitment. There are a few disadvantages with having little money and that is you would have to go for the lower-priced homes or distressed properties. You would also have to find lenders who are willing to push deals through.
3. You don’t need major assets
There is another point that many real estate investors seem to misunderstand and that is you need to put up major assets to buy a property or secure a contract. This is incorrect. What you do need is to understand how creative financing works. You see many investors just stop before they even begin investing in real estate because of certain beliefs they have in their heads about what is needed to get started in real estate.
4. Real estate provides better returns
It’s without a doubt that the best way to invest money is through investments that provide attractive returns in which you can save or reinvest. Real estate generates steady cash flow for real estate investors and provides better returns. When real estate investors have steady cash flow coming in from the monthly rental income this makes it easier for them to manage their finances and plan ahead of time.
5. The safer, the better!
It’s scary investing your money in something that you can’t guarantee is safe or not. Many people who invest in real estate would agree when I say that real estate is safe. Real estate investing is the best way to invest money because it is very safe since investment properties are tangible, physical assets – meaning it’s practically impossible for property investors to lose everything with real estate investing as long as they’re clever! If by any chance the housing market faces a crisis, then just hold on to your property until the situation improves. If in case of natural disasters, a fire, or destructive tenants, then don’t stress about it as your rental property is insured. For every situation that might occur with you in real estate, there is a way to overcome it. That’s why we always say “the safer, the better” and real estate is the way to invest!
6. There is more than one way to make money
The exciting thing about real estate is that there are multiple ways to make money and not just one restricted way. The world of real estate investing is immense with so many different options which makes it the best way to invest money. A real estate investor could invest in rental property for the long-term or short-term. Investors even have the decision to invest in commercial real estate or residential. Also, there are many different strategies to choose from such as buy-and-hold or fix-and-flip. Investors have many possibilities to choose from when it comes to the type of residential property. Do you want to invest in single-family homes, condos or maybe apartments?
Make sure to check out Mashvisor’s investment property calculator to help you determine which investment property type and investment strategy are the best way to invest money for you!
The bottom line
If you’re not sure whether or not you should invest in real estate or if it’s the best way to invest money then stop doubting and go for it! As you can see there are many reasons why you should invest in real estate and why it’s the best option for you. Start by gaining the knowledge required to become a real estate investor and the best way to do that is through Mashvisor. Mashvisor’s Knowledge Center contains thousands of blogs, guidelines, and strategies that help real estate investors in many ways and leads them to the path of a successful real estate investing future.