What is Real Estate?
In common language, a property consisting of land and buildings is termed as real estate. Along with the land and the buildings; real estate also includes the natural resources present on that very property.
Majority of the entrepreneurs and the investors own multiple portions of real estate which they have kept to produce income from rent as well as good amount of profits as and when the price of the particular piece of real estate increases in the market.
If you have a significant amount of additional income and are looking to invest your money then there is not a better option than real estate due to a variety of reasons which are elaborated below:
Why should you invest in Real Estate?
- You can get better returns as compared to the traditional stock market.
When you invest in stock market and buy shares of a certain company; you are always at a risk of losing your amount and facing losses as the traditional stock market is highly volatile in nature. The share of a certain company which might be giving good returns one day can turn upside down in a matter of seconds. However, this is not the case with the investment made in real estate. The more amount of time you hold your real estate investment the percentage of loss or risk involved is minimized. As and when there is an improvement or appreciation in the market the same happens with your real estate investment.
Hence, for the investment made in real estate; you are always having greater control as you can capitalize your investment and generate revenue through a variety of modes and at the same time you will be receiving the benefit of capital appreciation. Moreover, numerous real estate insurance programs are present to provide a cover for your investment under unforeseen circumstances. This is unlike the traditional stock market in which you are not having any sort of control over innumerable factors and are always at a risk of losing your entire investment.
- You can invest in real estate even without purchasing a property.
If you want to invest in real estate, it doesn’t necessarily mean that you need to purchase a property. You can opt for investing in real estate investment trusts or REITs. REITs can be, actually, termed as the mutual funds of real estate comprising a simple collection of properties owned by a company who takes money from various individual investors to develop that part of real estate. Later on, the investors are paid in the form of dividends, exactly similar to any other funds.
This way you can enjoy the benefits of real estate investment without, actually, having to burn a hole in your pocket.
- Real estate always has value
If you have a piece of land or a building; at any point in time; a particular value will always be present for your possession. This is, again, unlike stock market in which the value of your shareholdings can even dip down to zero and you could end up suffering a complete loss.
- Investing in real estate spreads or diversifies the risk
If you are investing in different regions then you are actually spreading your risk over various investments that you are making rather than concentrating on a single piece of investment. Real estate is always considered a safe investment which takes care of the risks that might be arising from your other areas of investments.
- Value of your real estate investment will grow over time
It is a fact that more amount of time you are in possession of your real estate investment; the more amounts of bucks you will generate out of it.
If you have purchased a property in a far-flung area then history is the witness that every far-flung area has become a nearby zone as a result of development. Whenever any kind of development around your property will happen; the prices are bound to skyrocket. In fact, many people have, actually, made millions by just investing in real estate itself.
Hence, if you are thinking of investing your funds; go with real estate as apart from being a safe and secured piece of investment; it can generate a good amount of peace and delight in your life.