By Peyton Zachrich - Why Invest in Real Estate?
Real estate investing, if done right, can provide higher returns than other asset classes such as stocks and bonds. It is common to see 15-20% returns on capital invested.
Rental properties can provide monthly cashflow. You can use this cashflow to buy more investments, to supplement your lifestyle if money is tight, or, if you accumulate enough rentals, to replace your income entirely and no longer need a job if you don't want one. This passive income can be one of the fastest paths to FIRE.
With current US tax law, individuals that invest in real estate can benefit from their investments from a tax perspective. This means that it's possible to reduce the amount of taxes one owes even while earning passive income from rental properties.
Real estate is considered a good hedge against inflation because real assets have typically appreciated alongside inflation in the past. Inflation can even help reduce your debt burden if you have a fixed interest rate.
If you own some stock of a corporation, you won't be personally able to decide who is running it, their strategic decisions, their pricing, where they do business, how they manage risks, or what opportunities they pursue. When you invest in real estate, you do determine all of these things. Choose wisely!
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