One of the most successful businessmen ever, billionaire Andrew Carnegie once famously said that about 90% of millionaires made their fortune from real estate investment. Isn’t that just amazing?! There’s no gainsaying in the fact that investing in real estate ranks highly amidst the best investment options, and this can be attributed to numerous reasons. The most notable of those is that it’s a great source of passive income and can also be a good long-term investment as the value increases over time. That means if you are thinking of building an effective wealth-building strategy, real estate investment is an excellent way to start.
However, like every other viable investment opportunity, you need to be properly informed about the nitty-gritty of real estate investment, especially the short-term and long-term benefits that come with it. Not just that, you also need to be well prepared as a prospective real estate investor. This implies that you will need to set aside a significant amount of money as capital to begin real estate investing. Acquiring a home, apartment complex, or even a piece of land doesn’t come cheap. So, if you’re still doubting if investing in real estate is right for you, here’s a list of the top 4 reasons why investing in real estate should be top of your investment plans.

Real estate is an excellent source of passive income

One of the age-old secrets to building wealth is having a diverse source of income, and real estate is one great source of extra bucks. It lets you generate a passive income for yourself while you still earn a regular income from any other full-time occupation. Your money works for you and if you invest in a profitable asset, you are assured of a 6% or greater cash flow after every operating expenses and mortgage payments have been made.

Real estate appreciates in value

If you are a new real estate investor or still considering your options, you need to understand that real estate is not a short-term investment plan. However, one of the major benefits of investing in real estate is that its capital assets (or land) appreciate over time. In other words, the overall value of your property value will be worth much more in 10 years, and that’s why investors are in it for the long run.

Real estate provides leverage

In addition to the aforementioned advantages, another remarkable benefit of real estate investment is that it can be leveraged. This means that the borrowed capital can be used to increase the potential return of an investment. In real estate transactions, it’s called leverage when a mortgage is used to reduce the total amount of investor capital required to purchase a property. At full maturity, you can leverage your real estate asset to secure a second loan against the increased equity or refinance the original loan amount plus the increased equity.

Real estate is improvable

Another attractive advantage of real estate is that it can be improved to augment its market value. Since every property is a tangible asset made of different materials, a facelift in the form of structural or cosmetic repairs can help to somewhat increase the value of any property. This means that you can enhance the worth of your real estate by improving it.
So, why aren’t you a real estate investor already?

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