When it comes to family and finances, it’s important to lay the brickwork for a lifetime of investment potential. Deciding where to invest your money can be a tough task to decipher, but real estate is quickly becoming the go-to for many families looking to secure safe and solid returns on their investment. Read on to learn why real estate might be the best place to make your next money move.
The Appreciation Potential
If you buy property now, over the years, it could appreciate immensely in value. If you buy in an area that’s projected to boom in the next few decades, you might find yourself sitting on a fortune by the time retirement age rolls around. Even if your property doesn’t see a significant amount of appreciation, there’s a minimal chance your investment will ever depreciate. Unless a natural disaster or some other unusual tragedy occurs, your land will continue to appreciate over time as land resources are limited. Supply and demand is consistently on the side of the land owner, and you’ll be rest assured that you’re making a more than safe bet when you put money down on a property.
It’s the Right Time to Pounce
This year might be the year for you to make your real estate investment, as low interest rates are an attractive option that might not be around for much longer. Rates are projected to increase with each passing year, so getting locked into a low-rate mortgage right now could save you thousands upon thousands of dollars.
It Could Help You with Your Taxes
When you purchase real estate, whether or not you are considered a real estate professional or an investor, the taxes could be worked in your favor. Use professional financial guidance to ensure you’re filing in a way that best benefits you and your family. You may qualify for tax breaks on travel expenses incurred while traveling to your rental property to make repairs, deduct expenses you pay to manage your property, and skip out on the self-employment taxes in particular instances.
The Rental Business is Booming
These days, homeownership is taking a backseat to renting. Many people unfortunately fell prey to foreclosure, while others are choosing to rent because of the flexibility and simplicity it offers. Whatever the case, it’s made for a competitive rental market that sees landlords getting multiple inquiries the moment their listing goes up on an apartment finding site like Trulia.com. There are a few costs to get set up with a rental business, but the return is more than worth the investment. Make sure you choose a property that will be appealing to prospective tenants, always be sure to rigorously screen any potential renters (use something like the tenant screening services here), and consider whether you’ll rent the home furnished or unfurnished to start. If you do decide to rent out a property, it’s important to consider whether you’ll be managing it yourself or hiring out to a trusted property management company. If you or your spouse is skilled with home repairs, you’ll have an advantage and should seriously consider handling the rentals yourself. However, if you’re looking for a more hands-off investment, a skilled property manager will be an invaluable resource.
A Vacation Home
If you plan to buy real estate in another area, it can double as a vacation home that pays for itself throughout the year on rental sites like Airbnb or VRBO. Make sure it’s an area you visit at least five or more times a year, and check with the regulations in the neighborhood about renting out your space—some communities may have bans against this. If it’s a place you think you’d like to retire in, you’ll have a head start on retirement plans, and you’ll see long-term appreciation profits on a purchase of this nature, especially in a destination spot.
If you’re considering a real estate investment, take the above benefits into serious consideration and make a smart financial move that will benefit your entire family.