Updated: Nov 7, 2020
Hello again real estate friends and happy Fall! As a Realtor it is important to recognize that many of my clients at first, do not fully understand the benefits of owning property. In this short read I will discuss a few simple reasons why investing in real estate is a smart way to build wealth, and security. As we move into the Holiday season, and another possible shut down here in Chicago, real estate will most likely slow down, but that shouldn't scare first time homebuyers/investors in attaining their real estate goals! As discussed in a previous blog, real estate is one of the leaders in this economy.
We all know that money does not grow on trees, right? But when you invest in a property, you are essentially growing wealth in building up your equity. In layman terms: When you buy a piece of property, you will most likely put down a downpayment. This is the start of building up your equity. The more you pay down the principle of the loan, in combination with the increase in value of the property, the more equity you have in the investment. Over time, if the property value increases and you are consistently paying down the loan, your equity will be healthy enough to start taking advantage of the wealth you have built. For example: A cash-out refinance can give the opportunity to purchase an investment property. Which offers numerous benefits, such as cash flow, and healthy tax deductions. As equity grows you are surely able to make a profit when you decide to sell!
2. CASH FLOW
Referring back to #1, when you build equity in your property it produces the opportunity to purchase an investment property. Whether you are interested in buying a 3-4 flat, or a single condo it can provide you with a healthy cash flow. After we budget the overhead cost of utilities/common areas, and taxes, the rental dollar flow can provide a secure amount of money in your wallet every month. Over time, as you pay down the mortgage for the investment property, the higher the equity, the higher your return in the investment! If you are a first time homebuyer, there is way to become investors right away without having to purchase two different properties. If you buy a 3-4 flat, live in one unit and rent out the others, you can take advantage of being landlords in the very building you live, collect rent, and build a healthy cash flow from the start.
3. INVEST IN YOUR FUTURE
There are many other reasons why purchasing real estate is incredibly beneficial to your wealth and security; such as tax deductions, monthly payments are going to you instead of a strange investor, and the opportunity to use the money you net in the way you choose. Besides all the wonderful reasons financially to own, there is one thing to not overlook. In my 8 years of selling real estate, I have never come across an unhappy client who decided to invest their home. I may have the occasional call asking how to change a furnace filter, or who they should use to clean the gutters, but as far as buyers regretting to invest in themselves, NO. When you purchase real estate, you are investing in yourself, in your family and in your future. Thats really why we should all fall in love with real estate!
Thanks for dropping in! Contact me by visiting our website at newlandconcepts.com to discuss your real estate goals: Happy Fall y'all!