Friday, January 27, 2012

Investing in Real Estate

Real estate is usually one of the most expensive purchases that a person ever makes. The cost of real estate has risen significantly worldwide over the last decade until the economic problems came to life. Even now that housing prices have stabilized, they are still much higher than at the start of the last decade.

This can make it difficult for people to buy or invest in real estate, but it is great for anyone who bought before the prices started to rise. As any loans on the property are paid off over time, the cost of living there will be limited to any taxes and repair bills.

Advantages of Real Estate

As well as providing you with somewhere to live, or work, real estate can really work as an investment. If you own housing, you can rent it out to bring in a nice amount of money every month to supplement your salary. You will have to pay out for any repairs, and bad tenants can do a lot of damage, but many landlords have an agency that takes care of all that for you. Another advantage of property is the high cost of it. It might cost you a lot of money to buy, but you can usually sell it for a profit. Many landlords accumulate a portfolio of property that they use as a retirement fund, and sell it off when it is time to retire.

Disadvantages

Real estate is really expensive, and it can be difficult to borrow the money you need to buy a property. This can make it very difficult to start investing in real estate, although treating it like a business and presenting a solid plan to your bank may help if you want an investment property. A lot of people also end up asset rich and cash poor.

Choosing Real Estate

The hard part is choosing which real estate to invest in. Your intended use of the property will determine which is suitable. A house for your family might be a completely different choice to a property intended for rental to the holiday market in a resort area for example.

If you have the necessary skills, then you can make a lot of money by buying properties that need renovating and performing the necessary repairs. Your skills will enable you to perform the repairs quickly and cheaply and you can turn around real estate like this for a profit within a short space of time.

Building and maintenance skills are also useful if you want to be a landlord. By doing the repairs yourself it will save on the costs of paying for skilled craftsmen. It will also save money if you can manage the real estate yourself and deal with the tenants, but many people prefer to use an agency to do that.

Real estate can be a great property investment that can make a great profit, but can lead to large losses. Anyone considering property as an investment needs to research the market properly and invest in the right property in the best location they can afford.

[This is a guest post]

10 comments:

  1. Sell your home quickly for cash and avoid the threat of repossession or chain breaks. Unlock the cash in your home - contact us today for a stress free sale

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  2. "Real estate can be a great property investment that can make a great profit, but can lead to large losses. Anyone considering property as an investment needs to research the market properly and invest in the right property in the best location they can afford."

    I agree but any sort of investment needs a proper research first. If both property and stocks are in extreme low valuation, I would rather go for property than stocks :)

    B

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  3. Real estate is a good investment but i do believe that you need to have a good and high paying job in order for you to afford a real estate property.

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  4. Hey, nice site you have here! Keep up the excellent work!


    House, Flats for Rent in Liverpool

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  5. Investment in real estate is always good. But inverter should be intelligent about investing his/her money at right time & place.

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  6. When investing in real estate properties, it would be a great advantage if investors pay in cash. That way, mortgage will no longer be a problem. It will also be easy to invest on other properties in the future in the absence of mortgage issues. Another thing is that, their ability to pay in cash will give them an edge over other investors to negotiate for lower price. Sounds good, eh?

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  7. Hi Allan,

    When investing in real estate, it is seldom one is able to pay up in cash due to the high cost of housing in most areas.

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  8. It is still possible to invest in real estate by using your 401k and Roth IRA. Not only will these decrease the tax you have to pay from your property investment taxes, it will also make it possible for you to invest in real estate because just like what FF said, it can be intimidating to buy properties in cash because of their high cost.

    Come visit our website for more information, tips, and REInvestor interviews at http://courseinrealestate.com

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  9. Mostly people are chooses real estate property investment for investing their money because it provide a highest money returns of investment in short time. So i think real estate investing is good idea for safe money investing with profit gaining opportunities.

    Farm Sheds

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