3 Reasons to Invest In Real Estate

Aside from being your own boss, having the freedom to travel while earning profits, increaseing your net worth and having a place of your own to call home, investing in real estate holds even more benefits:

Cash Flow

Rental properties when purchased correctly generate significant cash flow.  If purchased with 100% cash then the cash flow is going to approximate the cap rate and that rate tends to run between 5-10% depending on the type of property and where we are in the real estate cycle.  Currently many properties are able to produce numbers near the high end of that range or even above it.  These are very strong numbers.  Remember that this doesn’t count the appreciation of the property.  This is just cash that you put into your pocket every year; cash that is not all taxable due to deprecation; cash that will be generated reliably year after year with no significant reduction, but slow consistent increases. Source:FreeMoneyFinance

 

Tax Benefits
Let me ask you a quick question: if you earn $100,000 at your own business and I earn $100,000 through rental properties, who gets to keep more?
That’s right: I do. Because the government rewards rental property owners.
Not only is the cash flow received from your rentals not subject to self-employment tax, the government offers tax benefits including depreciation and significantly lower tax-rates for long-term profits. 
Source:Entrepreneur

 

More Value at Sale
While it’s providing rental income cash flow, your property can also be improved in order to garner a better price and more profit when you do choose to liquidate it as an investment.
Upgrades to the appearance and functionality of a real estate investment property can significantly increase value. As trends and styles change, keeping the property interesting to renters will at the very least help you to retain value. 
Source: RealEstate.about.com



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