6 Reasons Why Real Estate Is a Great Investment

Right. The stock market is doing great, no wait, spectacular! And has done great ever since our last election. And so is our economy. 

So you invested in the stock market. But real estate is still an awesome and great investment. And I know a thing or two about it as my clients have reaped the benefits of making money in real estate. 

Real estate is a great investment for many reasons. You can enjoy an excellent rate of returns, amazing tax advantages and leverage real estate to build your wealth. Here are the top five reasons why real estate is a great investment.

Overall - REAL ESTATE PROVIDES BETTER RETURNS THAN THE STOCK MARKET WITHOUT AS MUCH VOLATILITY - you know the ups and downs. Real estate always has a long term perspective. Historically in real estate, your risk of loss is minimized by the length of time you hold on to your property. When the market improves, so does the value of your home, and as a result, you build equity. The risk never changes in the stock market and there are numerous factors beyond your control that can negatively impact your investment. Real estate gives you more control of your investment because your property is a tangible asset that you can leverage to capitalize on numerous revenue streams (rental income for example), while enjoying capital appreciation.

With real estate, it has an actual physical address, you can drive to it, look at it, touch it - it's real! A stock on a company, not quite the same. Know what I mean?

REAL ESTATE HAS A HIGH TANGIBLE ASSET VALUE. There will always be value in your land, and value in your home. Its always there. Other investments can leave you with little to no tangible asset value such as a stock which can dip to zero, or a new car which decreases in value over time. Homeowners insurance will protect your investment in real estate, so be sure to get the best policy available so your asset is protected in the worst-case scenario. A house can be destroyed, but never the land. There is always a residual value.

REAL ESTATE VALUES WILL ALWAYS INCREASE OVER TIME. History continues to prove that the longer you hold onto your real estate, the more money you will make. The housing market has always recovered from past bubbles that caused home appreciation to slip, and for those who held on to their investments during those uncertain times, prices have returned to normal, and appreciation is back on track. Now, real estate investors in the top performing markets are enjoying a windfall. In fact, this past year, every state in the nation had a positive appreciation, and many of my clients in Phoenix Scottsdale market have made absolutyely great money! I mean, GREAT MONEY.

Ok, you invest in securities, the stock market and other forms of investsments. That's great! AN INVESTMENT IN REAL ESTATE CAN ALSO DIVERSIFY YOUR PORTFOLIO. If you've ever spoken to a financial planner about investing, then you are very aware of the importance of diversification. When you diversify your portfolio, you spread out the risk. Real estate will always serve as a safe tangible asset to mitigate the risk in your portfolio. Many have amassed wealth by solely investing in real estate. But sometimes, many investment planners and wealth managers don't understand real estate or are unfamiliar with real estate - and that's a problem.

REAL ESTATE INVESTING COMES WITH NUMEROUS TAX BENEFITS. You can get tax deductions on mortgage interest, cash flow from investment properties, operating expenses and costs, property taxes, insurance and depreciation (even if the property gains value) and other benefits. The end of the year is a very busy time for real estate because people want to take advantage of the numerous tax benefits before the end of the year!

An investment in real estate is not only a safe financial investment, it is also an investment that can provide years of fun, happiness and priceless memories that will last a lifetime.

LAST BUT NOT LEAST, try this test. Go to your favorite bank. Tell them you want to borrow $400,000 to invest in the stock market, and that you'll only put 10% down on the total investment amount. And without posting a security of any sort. When your banker has finally stopped rolling on the floor laughing, then say that you would like to borrow $400,000 with a 10% down to purchase real estate. Then you'll be given the immediate red carpet VIP treatment with a serious look. Get the idea? THAT'S REAL ESTATE.