Is Property a Good Investment?

Even in a pandemic-hit market, smart home insurance, and landlord insurance keeps property investment a safe bet. If you do enough research, then you would find out that real estate is quite an accessible market right now. Assess your finances, consult a mortgage broker, and see what kind of loan you can get. 

So, is property a good investment? What makes us think that property investment is the way forward? We have detailed some of the reasons down below. Have a read and see whether or not you feel convinced to take a chance on property investment going forward. 

The Need For Real Estate Is Ever-Present 

Real estate is a sector that involves one of the basic human needs-accommodation. So, it is a side of the economy that is never going away. Many investment opportunities might fade into oblivion over time. While real estate has its ups and downs, it will never run out of demand. 

For example, let’s consider the whale oil industry. In the 19th century, life without whale oil was unimaginable. It had widespread use as a lighting fuel and financing whale hunting for oil extraction seemed to be a foolproof investment opportunity back then. But, as camphine came along, the entire whale oil industry vanished into thin air. 

It can be said with confidence that there is no such uncertainty in the real estate industry. As we said earlier, it caters to an indispensable need. No matter how much change the world goes through in the future, people would always require a roof over their heads. 

Real Estate Investing Is Low Risk

The cyclical character of the stock market always keeps investors worried. The trend of bear and bull markets is a mainstay in the stock market structure and an economic downturn could extremely devalue the stocks in your possession. In such cases, you could see your assets shrink by half or more overnight. 

A recession would drive the price of your real estate down too, but the magnitude of the price fall would be far less severe. A $500 stock would be worth absolutely nothing only in a matter of days. But, regardless of how dire the contemporary situation is, your real estate would always hold a decent monetary value. 

Real Estate Price Inflates Over Time

You can expect high returns on your investments in the future when you purchase real estate. The house and land would appreciate in value as time goes by. In many cases, you would find that the piece of land the building is standing on, has risen significantly more in value. 

Other than recessions and natural calamities, property prices always exhibit an upward inclination. There are several factors that can explain this. Declining mortgage rates, growth in population, improvement in public transportation blow up the price of real estate in the future. 

You Can Make It Even More Desirable

Once you acquire a stock, you can do little to improve its monetary value. But in real estate, you have the option to raise the financial profile of a property. For example, if you add a pool to your property or upgrade the kitchen, you would be adding more amenities, and in doing so, you would be making the property more enticing. 

These tweaks you make around the property would make it more comfortable to live in and, of course, ramp up its aesthetic appeal. When you try to cash in, these upgrades would be strong arguing points for you to ask for higher prices. The chance of making more profits is right in your hands when you are making real estate investments. 

Home Equity Loans

Need some urgent cash? You don’t need to liquify your assets to get it if you have real estate properties. Since real estate is a tangible asset, it enables the owner to offer it as collateral, and take out equity loans. You can use the money to settle your immediate need, and then reclaim the property by paying off the loan later. 

Rent

Investing in properties in an area where people frequently visit, can be a great way to establish a surplus revenue stream. You wish to sell off the property later and make some profits, but why not make money from it in the meantime? You can rent out the property and receive regular payments from tenants. 

Tax Benefits

You would become eligible to receive substantial tax benefits upon making real estate investments. You would get mortgage interest deduction and also enjoy deductions in local and state property taxes. You can also pay less in capital gain taxes when you sell off your property, compared to other assets. 

*GasanMamo Insurance Limited is authorised under the Insurance Business Act and regulated by the MFSA