Real estate investing just makes sense. First, there are four ways you make money;
- Cash flow before taxes
- Principal reduction
- Tax advantages
I have talked about these 4 Benefits of Real Estate Investing time and time again. (Follow the link.) And I’m going to keep talking about them.
Cash Flow Before Taxes
If your home isn’t going to generate cash flow…DO NOT BUY IT! (Or if you already have “income property” that doesn’t cash flow….SELL IT! How much cash flow? Well, that is up to you, the type of property, where it’s located, the end goal, etc. Seek the advice of a qualified investment real estate agent or hire Chris as a Real Estate Counselor to help you evaluate a rental property.
Your tenants are buying you a house!!!! That’s all I will say for now.
Listen, we live in a great country and taxes are necessary to keep us all free and to educate our kids and to drive on roads, etc. But real estate can help shelter a great deal of your tax burden. (And provide quality housing, create a larger tax base overall, etc.)
This is the one we can never predict with certainty, but over the life a house it almost always is an effective hedge against inflationary pressures, at the very least. Unless, you are one of these guys that likes to chase low priced rental property in hopes for ROI’s of 20% or greater all the time. Then you are probably buying low end property in neighborhoods that could very well be on the decline. Treat those like melting ice cubes. But you aren’t doing the neighbors any favors.
There are a great many social benefits to being a buy and hold real estate investor besides just the money. Helping to stabilize neighborhoods. Providing quality housing. Providing jobs. Do it right. And reap the rewards.
Investing in real estate just makes sense.