Investing in real estate for the first time can be difficult. There are many things to consider, many decisions to make, and many conflicting sources of information. Yet despite all the odds, thousands of people decide to invest in real estate every year, rarely regretting their choice.
Whether you're preparing to move to a thriving area like Rochester, NY, or just looking to build a real estate portfolio, real estate investing is a financially smart way to go down for a number of reasons. Here are just a few of the great things about investing in real estate that make it a worthwhile endeavor.
Benefit from your investment
Real estate ownership is an attractive avenue for many because it allows you to acquire an asset that is more valuable than your initial outlay. In other words, you can buy a home for a fraction of its value and the loan will pay for the rest. But while you've paid off your house's debt, you can start making money right away. Unlike stocks or bonds, where you can only get the value of an investment product in cash, real estate investing allows you to earn rental income from a home that is much more valuable than initially available for investment.
Flowing cash
With most other assets, your money is taken, but real estate allows you to free up money from rental income. The higher the value of your mortgage, the more you will pay each month. This income sounds too good to be true because your initial home investment will continue to grow as your tenant income increases, but it's one of the biggest benefits of this type of investment.
Sell
In addition to providing excellent and sustainable income from rental payments, your property should appreciate in value over time, and with the right financial advisor, you can make a lot of money from a timely sale. The U.S. real estate market is strong, and there can be very lucrative jumps in real estate values, providing an opportunity to expand your portfolio. (VIPs, please note that real estate can also depreciate in value, so be sure to seek professional advice on an individual basis before making any decisions.)
You can put the work
By looking at a real estate investment from a long-term perspective, you can help it appreciate faster than just by building a project to follow normal market prices. Improving the interior and exterior of homes and renovating buildings is a great way to increase your investment; you can even make it your own business.
Is it right for you?
You need to be confident that real estate investing is the right financial move for you, so professional advice is a must. But with so many exciting developments in our country's real estate market, now might be a good time to make that change in a place like Rochester, New York. Both rental income and home appraisals are great ways to generate income to improve your quality of life while providing housing for others. If any of the above benefits appeal to you, then you may want to seriously consider it.
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Danny Torres of Torres Turn Key is a Rochester, NY-based real estate management firm with over a decade of experience dealing with domestic and international real estate investment clients. The firm provides full-service commercial and residential real estate, bringing together a wealth of experience and expertise to build long-term relationships that create maximum value and benefit for clients.