Famous billionaire Andrew Carnegie said 90% of millionaires get their wealth by investing in real estate. But is investing in real estate still a good idea today?
According to the real estate specialists here with us, the answer is a resounding ‘YES’. We show why…
Many real estate investors, who amassed considerable wealth later in their careers, started small. And usually because they also had to live somewhere. They scraped together a little money and bought a small studio.
A few years later, the studio then increases in value, giving the investor in question enough money to put down enough advance for a one-bedroom apartment, for example. That will quickly become two bedrooms, then three bedrooms, and before you know it you are living in your own villa with swimming pool.
Buying that small studio was the most important decision you could make at the time…
Residential homes can generate income all year round.
Investing in real estate is a good idea if you look at it long term, not for quick returns.
Your best bet is to invest in homes that provide year-round rental income. Just make sure you understand all the associated legal costs and have enough money on the side for any unexpected costs or the period between two tenants.
The right investment will continue to increase in value.
It is always a good idea to put your money into real estate. But let’s be clear, that doesn’t mean ALL real estate is a good idea!
It is best to buy only certain types of real estate, usually multi-family homes in the better locations that offer consistent cash flow and great potential for future appreciation.
Don’t get us wrong, smaller homes are usually a good idea to invest in too. It is certainly better than having your money devalued in some bank account!
Buying is smarter than renting.
There is more money to be made from owning real estate than any other investment. Real estate consistently increases in value over time and outperforms other investments.
In addition, it is not as vulnerable to short-term fluctuations as the stock market. You get a tangible, usable asset, whether you rent an apartment or commercial building for income or buy a house.
Aside from the tax benefits, but we’ll talk about that later…
It is ALWAYS a good time to buy real estate. Insiders tip: In fact, real wealth comes from buying when everyone is selling and vice versa. While many are talking about a recession, the market is strong, with prices and transactions rising.
Renting a one-bedroom apartment can cost upwards of $1,000 a month in certain neighborhoods these days, but for that price a month, you can buy a house worth several hundred thousand dollars. You don’t want to take big risks? Buy a garage. Rental income guaranteed!
So why should you rent? Besides, if you rent out your home to someone else, you can cover your mortgage, sometimes even more.
You (still) get serious tax benefits.
Real estate has some nice tax benefits. Therefore, the more affluent people collect real estate as they used to collect cars. Interest rates are low and prices are more or less stable.
At the same time, many people also opt for renting instead of owning, because they do not want, cannot or dare to take the risk. So you can have a lucrative rental property with the money of others (your tenants) to pay the mortgage, taxes and maintenance. Short-term rental? No problem, for your home in more touristy places you use websites such as Airbnb to subsidize your overhead.
We always suggest diversifying your investments, but there is no better place to park your money than brick investments that you can live in and enjoy or rent out.
You need (relatively) little starting capital.
Real estate tokenization can be used as leverage for future possessions. And you can already acquire a property with a relatively low amount. You then grow your investment with the money from the banks. With such low interest rates, that’s like free money!
Unlike the stock market, where many factors are beyond your control, your investment cannot disappear overnight. You also build your wealth with excellent returns and tax benefits.
It often takes time to see large increases in value, but if you have patience, you will see your investment pay off slowly but surely.
Real estate offers unlimited possibilities.
Real estate is always a great investment because you have more options than other types of investments.
When you invest in stocks, bonds, … your success is completely dependent on factors beyond your control. At most, your options are to keep or sell. With real estate, you have unlimited options.
You can buy a house with the intention of transforming it and then rent it out when it’s completely finished. If you buy a rental house that increases significantly in value, you can sell it. Real estate can be refinanced, remodeled or even repurposed. You can develop it, rent it out, subdivide it, or add lots to it.
People will always need a place to live.
With real estate, there is a chance of greater and more consistent returns than with other investments. When a property is built, it is because a group of people see a population large enough to justify it.
The number of new properties each year is a testament to the growing real estate market. Supply follows demand, and demand continues to rise. Populations almost never decrease, which is why the need for housing increases every year.
The market for apartments in particular is growing. As apartments become more attractive, people are less likely to buy houses. With apartments you generate more and more income over time. There is demand all year round, wherever you go.
You can invest in land that generates income.
Many companies come and go, but there is one thing we will always need: land.
There is an inherent demand for land, whether it is producing fruit or vegetables, or housing an apartment or retail space; so it will always be a good investment. It doesn’t matter what kind of business you run, you need land.
Investing in real estate allows you to protect yourself and your assets. While the real estate market goes up and down, it has rarely fallen in the long run. Compare that to the stock market collapse or to currencies not backed by anything tangible.
Over time, you will always gain value from real estate that generates income, such as a rental property. It is even better if you opt for real estate with inherent value, such as in prime locations. But then the investment is of course a lot bigger. But the income is correspondingly…