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If you look at some of the most successful people in the country, almost all of them are invested in real estate. In fact, 90% of US millionaires have real estate as part of their investment portfolios. However, they don’t have everything in this market. Like every good investor, they have a plan and stay diversified. And you should do the same.
Here are five reason why you should invest in real estate.
True diversification isn’t what most people think. Did your portfolio go down in lockstep with the market earlier this year? If it did, you may not be properly diversified. Everyone needs assets that don’t go up and down with the stock market, and real estate could be one of those.
Real estate has more tax advantages than any other investment, but it will differ with each type. Not only can you get passive income that can be largely offset by passive losses, but you can also incur depreciation either up front or over time.
Historically, real estate goes up over time. So, you can get paid to wait. Depending on the type of real estate, you can get income over time. This may be in the form of rental income, which can come from any of the following properties:
All of these real estate types can give you additional cash flow.
Everyone needs a place to live, so the real estate market can’t be disrupted. You can invest in affordable rental properties (such as single-family and multi-family homes). And if inflation returns (which is very possible), rents can go up. This could give you an inflation hedge, which can protect you in times of volatility. This is one of the reasons why real estate is a great diversifier.
Unlike the stock market (where you don’t have much control), real estate can give you a more level playing field. Depending on the type, you can have that control. You can force depreciation by raising rents or by improving the property. You can also decrease expenses through better management.
There’s a variety of ways to get started in real estate. You can start small or get a partner, and you an eventually invest in something big. For more information about how real estate can be a great addition to your investment portfolio, get in touch with Trevor Shakiba at Shakiba Capital.
It’s one thing to earn a paycheck, but it’s another thing to put that money to work for you. Real estate is very attainable for a lot of people, and it can be a great way to diversify out of the stock market. Approximately 90% of America’s millionaires are invested in real estate, which should tell you something.
Investing in Opportunity Zones has many advantages from tax perspective. I’ve listed three of the most common below: When you roll over capital gains into a Qualified Opportunity Fund within 180 days, you can defer their recognition until December 31, 2026. For most taxpayers, the tax on the gains would be due in April 2027. […]