The 5 Key Benefits of Investing in Real Estate

From increasing your monthly income to padding your retirement fund, with the right planning and the right property, real estate has the potential to deliver some incredible benefits.

Here are just a few of the many great reasons why you should consider investing in real estate:

A Steadier Cash Flow

One of the first and most obvious reasons why people opt to invest in real estate is to improve their cash flow. A great way to supplement your current earnings, income properties can deliver a significant financial surplus depending on how and where you choose to invest. In short, any funds left after paying the mortgage and additional expenses (which may include utilities, repairs and maintenance, etc.) is extra money in your pocket.

Building Long-Term Wealth 

Real estate investments can provide some serious financial security over the long term. While it does require a little patience, with each tenant payment, you build equity and wealth in the property. A valuable asset, you can put your equity to work in a variety of ways, including:

• A down payment on your next home
• Home Equity Line of Credit (HELOC)
• Funding your retirement
• Etc.

Property Appreciation 

Yet another benefit of investing over the long-term is the potential for property appreciation. Here again, this may depend on how and where you choose to invest – but a property’s value will likely increase over the long term. As the tenant(s) pay down the mortgage over time, you can look forward to a significant return on your investment over the next several years.

Choosing the right neighbourhood is key to securing a great property with even greater appreciation potential. Download our free copy of Your All-In-One Guide to Choosing The Right Edmonton Neighbourhood for more information. 

Multiple Tax Benefits

Real estate investing is also not without its tax breaks. Not only are investors entitled to lower rates, but their also eligible for a variety of other exemptions: 

• Rental property insurance
• Advertising costs
• Legal fees
• Repairs and maintenance
• Depreciation deductions
• Property taxes
• Bookkeeping and accounting costs
• Travel expenses
• Salary and wages applicable to a property manager
• Etc.

Hedging Against Inflation 

Unlike most goods and services which are susceptible to inflation, real estate reacts proportionately. Simply put, as the cost of living increases (rental prices and property values), so too does your cash flow. Your (fixed-rate) mortgage payment also remains the same, allowing you to pay your loan off faster while enjoying a surplus in passive income at the same time.

Talk to Your REALTOR®

Whether you’re a seasoned real estate mogul or new to the market, we recommend enlisting the help of an experienced Edmonton REALTOR®. Not only will they provide expert investment-related advice and guidance, but they’ll also help you zero-in on the best properties, negotiate a better asking price, and much more.

For more information, visit our blog or feel free to download any (or all) of our helpful home buying and selling related resources:

• Buyer Guide
• Six Essential Tips That Make Home Buying More Affordable
• Seller Guide
• Home Renovation Guide
• And More!

 Photo credits: Shutterstock.com

Categorised in: Real Estate Investing

This post was written by Terry Paranych Real Estate Group