Five Reasons Why You Should Invest in Real Estate Right Now
In the realm of investment opportunities, real estate has emerged as a time-tested
and reliable avenue for individuals seeking to grow their wealth and secure their
financial future. Whether you're a seasoned investor or just beginning to explore your
options, gaining a clear understanding of the importance of investment can offer
valuable insights.
So, let’s delve into the five compelling reasons why now is an opportune time to
invest in real estate. From the potential for wealth creation and steady income to the
tax advantages and tangible nature of real estate assets, we will explore the
significant benefits that come with real estate investing. So, if you've been
contemplating where to invest your hard-earned money, uncover the benefits of
investing in real estate below that deserve your attention and consideration in today's
market.
Massive potential for appreciation
Real estate has a remarkable track record of value appreciation over time. Property
values tend to increase, allowing investors to reap substantial profits when selling
their assets. According to ET, some statistics highlight that the average rate of
property prices in Bengaluru saw a 10% appreciation in the past year, making it
the market with the sharpest uptrend in property prices. Additionally, rental income
also tends to rise, contributing to higher cash flow. Unlike the stock market, real
estate provides a greater level of control over investments and offers the potential for
multiple revenue streams, while enjoying capital appreciation.
Cash Flow
Having extra cash coming in from another stream of revenue never hurts. Rental
income from properties can provide a consistent source of cash flow for business
owners, in addition to the income from your company. Real estate investments offer
the advantage of generating consistent cash flow. After deducting mortgage
payments and operating expenses, rental income provides a reliable source of
passive income. As time progresses, cash flow tends to strengthen as mortgage
payments decrease and equity builds up. With good real estate investing, you can
expect a cash flow of 6% or more, ensuring long-term financial security.
Tax Benefits
Real estate investing provides various tax advantages that can help reduce overall
tax burdens. In Bangalore and all parts of Karnataka, taxpayers can claim
deductions on home loans taken against investments in property. This is a great way
for people to save on their tax payments. Rental income is not subject to self-
employment tax, and property owners can benefit from tax breaks on property
depreciation, insurance, maintenance and repair expenses, legal fees, and mortgage
interest. Moreover, long-term real estate investing often enjoys lower tax rates,
allowing investors to optimize their returns.
Inflation hedge
Gold no doubt acts as a hedge against inflation in the long-term; however, nothing
beats real estate. Inflation has a soothing effect on real estate debt, as the market
turns inflationary, the prices of homes rise over time. As the value of money
decreases over time due to inflation, the value of real estate tends to increase,
helping to preserve the value of the investment. As business owners, we are always
looking for ways to maximize our money. Inflation literally evaporates the value of
our hard-earned dollars, and having a healthy real estate portfolio simply helps you
hedge your bets.
Secure and Safe Investment
Compared to other assets like stock markets and cryptocurrencies, real estate is a
relatively safer investment choice. In uncertain times like pandemics, inflation issues,
and recessions, stocks and bitcoin are too volatile investment options. On the other
hand, throughout the past few decades, real estate has consistently grown. Sales in
the real estate sector have increased as a result of the Real Estate Regulatory
Authority's (RERA) establishment, decreased home loan interest rates, and
decreased stamp duty in some states. Real estate values are stable and less prone
to frequent volatility, unlike stock markets and cryptocurrencies, which are overly
fragile. Of course, this comes with the caveat that you should invest in a ready home,
where there is no risk of delays, or invest in under-construction property only with a
good developer with a solid track record and after the requisite due diligence.
Bottom Line
Investing in real estate today can be a smart choice for individuals seeking a secure
and profitable investment avenue. The advantages of real estate investment include
the potential for value appreciation, consistent cash flow, tax benefits, leverage
opportunities, and the tangibility of assets. These factors give the answer to why
invest in real estate for diversifying portfolios and building long-term financial
security.
Agarwal Estates is a reputable real estate company in Bengaluru, known for its 10
years of experience and 95% customer delight. The core concept revolves around
empowering customers through knowledge, building trust and transparency by
providing comprehensive information, and fostering a strong bond. Choosing
Agarwal Estates can be a reliable decision for individuals looking for trustworthy real
estate services in Bengaluru.
