Why You Should Invest In Real Estate

Real Estate investment is the purchase of future income stream from property and can offer other types of investments, including potential higher returns, stability, inflation hedging, and diversification.
Investing in real estate is the best way to earn a passive income, save for retirement, and build a diversified investment portfolio.
Real estate investing has many benefits and is a great source of passive income. Because there is a large demand for properties, the value of real estate usually appreciates, increasing your potential for profit. Aside from financial advantages, there are other important benefits of investing in real estate. Below are some of the benefits of Real estate investments;
1. You Can Generate Passive Income:
By investing in real estate, you can generate passive income that is nearly tax-free. Your rental properties will work for you even when you are sleeping. By buying several rental properties that generate enough income to cover your expenses, you have the freedom to do what you enjoy, instead of spending all of your time at work.

2. It Can Provide Cash Flow for Retirement:
Real estate investing, when done right, is a stable way to increase wealth over a period of time. Among the many benefits of real estate investing is that it can provide cash flow for retirement. This means it can help supplement your retirement years with income from your rental properties.

3. The Value of Real Estate Appreciates Well Over Time:
Real estate has been a very attractive investment for many individuals and institutional investors. Recently, the amount of capital chasing the ownership of Real estate has substantially increased. Values are increasing for two reasons. The first is that rental rates are continuing to rise because of the demand for these facilities and increasing construction costs. Secondly, with the number of investors bidding on real estate investments, the cap rate, or yield, are continuing to compress, which is increasing values.
For instance, vacant land properties sold at N50,000 as at 90s are now being sold for over 20 million naira per plot. The value keep increasing on a daily base.

4. You Can Indulge Your Entrepreneurial Spirit:
There are many ways to invest in real estate and become an entrepreneur. You can buy a home, fix it up and put it back on the market for a profit. Buy a property to hold and let the appreciation create wealth. Perhaps you become a landlord and start purchasing rental homes, multi-family homes, or even apartments. Maybe land development is for you. You are the boss.

5. Real Estate Investing Is a Hedge Against Inflation:
While most people fear inflation, this is not the case with real estate investors. Investing in properties is an excellent hedge against inflation. As the price level goes up, so does the rental income you get from your property and your investment’s value. This means that real estate investors are protected against both the immediate and the long-term effects of inflation. Although this might not be the first benefit of real estate investing that comes to mind, you should take it into consideration because for real estate investors, an increase in the cost of living is associated with a growth in their cash flow.

6. Owning Property Generates Wealth:
Everyone should own at least one house or a piece of property. One of the many benefits of investing in real estate is being able to generate wealth through appreciation, building equity, and hedging against inflation. It can also provide cash flow with passive income from rental properties. These are the reasons why real estate should be a key component of your investment portfolio.

7. Real Estate Is Easy to Finance & Provides Leverage:
Real estate as an asset investment vehicle is easy to finance. You can borrow 50 percent to 90 percent of the acquisition cost at attractive rates, often rates below the anticipated annual investment return. The ability to magnify the investment return with financing is called positive leverage. Stocks, bonds, commodities, and art do not offer the same ease when being used as collateral for financing.

8. You Have the Option to Change Your Primary Residence as Needed
If you own multiple properties, you may have the option to change your primary residence from one to the other, should you decide to do that later in life. Many people prefer a two-story house when they are raising a family, but decide to downsize to a one-story in their golden years because it is more manageable for them.

9. You Can Enjoy a Variety of Opportunities:
According to Bankable Insight, investing in real estate offers a wide variety of opportunities for investors. You have the option to invest in single family residences, multi-family homes, vacant land, and commercial buildings, depending on your initial startup capital, leverage, and personal preference. Even if you don’t have sufficient experience in real estate investing, you can still get started once you have the funds or resources to purchase a property.

10. Real Estate Can Never Be Worth Nothing:
Aside from the fact that most real estate values usually appreciate, your real estate investment can never go down to zero, even during a difficult time. You can always sell your property when you own one. Unlike a stock, real estate never becomes worth nothing, even if the value drops.

11. There’s a Potential for a High Rate of Return:
One of the biggest benefits of investing in real estate is the potential for earning a high rate of return.

So I call on you to take the bold step and invest in Real Estate Today and enjoy these benefits...



- Goodluck Chima Gabriel,
Real Estate Consultant and Analyst.