Is it Smart to Invest in Real Estate?
When it comes to investing or building a portfolio, the main goal is to get a solid return on your investment. Given the variety of choices people have today, many wonder about what investment opportunities are best for them.
While no single investment is best for everyone, real estate can be a lucrative option for those seeking alternatives to the stock market.
Steady Cash Flow
Steady cash flow from an investment can make a major impact on your finances. With the stock market, you can obtain stocks that pay a dividend, but it’s mainly based on factors beyond your control. A stock dividend can be paid quarterly, yearly, or not at all, and the amounts can fluctuate significantly.
With real estate investing, you can receive a steady income every month as passive income. Either through a property manager or researching the market, you can charge a monthly rental fee that matches market prices. It’s within your control to determine if or when that amount changes.
Predictable & Less Volatile Option
Most investments in a portfolio are tied to the stock market. This can leave your financial future in jeopardy, as you have no control over what can happen. Many factors can impact the stock market such as world events, elections, or natural disasters. You also have to consider factors within a major corporation as well such as scandals, mergers, or poor performance that can negatively impact stock prices and your portfolio.
Since real estate isn’t directly tied to the stock market, you can have a much more predictable and less volatile investment. Of course, you do have to figure in economic factors in the areas where you are considering purchasing property, but you can avoid potential problems by doing the appropriate research and working with a professional investor.
Long-Term Financial Security
When the stock market takes a dip, you can lose a significant portion of your investments within minutes. And, there’s no promise of when you’ll be able to recover it.
The combination of a steady cash flow and that real estate values appreciate over time makes it an investment that can provide you with long-term financial security. Even though some areas took a hit during the recent economic downturn, you can potentially avoid risk by doing location research or working with someone knowledgeable about the area.
Is Real Estate Investing the Right Option for You?
In the end, only you can decide if investing in real estate is the right option for your specific situation. The best thing to do is research your options, and then you can make an educated decision. If you’re looking for a less volatile alternative to traditional investing that also provides you with a steady, passive income, you may find that real estate is your best bet.
If you have questions about real estate investing, contact a member of our team by filling out the form to see how we can help.