The Benefits of Real Estate Investing

Real estate investing is increasing at a staggering rate these days.  More and more individuals are learning that real estate investments can offer wonderful earning potential.  Real estate investing is a process which has many attractive qualities that make it a viable money-producing opportunity.  There are a number of benefits that go along with purchasing real estate investments and the following paragraphs will highlight some of these benefits.  As you will see these attributes make it quite apparent why individuals are becoming interested in investment opportunities of this type.

Building Equity

For those individuals who are looking to invest in real estate on a long-term scale, there are certain benefits to doing so.  When individuals purchase real estate and hold onto it for awhile, they are ultimately able to build a good deal of equity in the home they are purchasing as an investment property.  Equity is a beneficial aspect for the homeowners as the more equity  a property has, the more that it adds to the net worth thereof.  This is an important and frequently cited reason why individuals do choose to invest in real estate and maintain the property as an investment for a long period of time thereafter.

Tax Advantages

Another benefit of purchasing real estate for investment purposes is the possible tax advantages that one may receive as a result of owning the investment property.  Depending on a variety of factors, individuals who own investment property may just see some gracious tax advantages as a result.  Therefore, individuals may be more than ready to invest in real estate once they have looked into possible tax advantages that result from engaging in a transaction of this type.

High Rate of Return on the Sale of the Property

When the investment property is sold somewhere down the road, the homeowners will most likely see a high rate of return on the sale of the property. Depending on the market at the time of the purchase and sale, this rate of return may be more than generous when one looks at the profit margin.   Some factors to consider if looking to purchase property and sell it within a short period of time after the initial purchase include current market for property sales, renovations and upkeep necessary to get the property ready for the sale and ability to hold on to the property longer if a sale does not come as quickly as one had expected.   If one has considered all of these possibilities and still feels that they will be able to sell the property quickly, then this is a wonderful benefit of real estate investment.

Leasing the Property to Tenants

While some real estate investors choose to purchase the property and then sell it shortly thereafter, there are other individuals who have a different reason for purchasing investment properties and wish to obtain a profit by other means.  These individuals are ones who prefer to purchase the property and then lease it out to tenants.   By doing so, the homeowners are able to pay for any mortgage which may be present on the property plus receive any additional income from leasing the property to tenants.

Investing in real estate is a wonderful way to gain equity in a piece of property, take advantage of possible tax benefits and maybe even make a considerable profit from the sale of the property once the individual feels like doing so.   These are some of the many reasons why individuals are purchasing real estate as investment property and current low interest rates make now a perfect time to buy.  The benefits of real estate investing are difficult to pass up, so go ahead and find your first real estate investment property!

Bill Manassero is the founder/top dog at “The Old Dawg’s REI Network,” a blog, newsletter, and podcast for seniors and retirees, that teaches the art of real estate investing. His personal real estate investing goal, which will be chronicled at olddawgsreinetwork.com, is to own/control 1,000 units/doors in the next 6 years. Prior to that, Bill and his family lived in Haiti for 11 years as missionaries serving orphaned, abandoned and at-risk children.