Real estate investing is without a doubt a great investment. However, this does not mean that it is great for everybody. Some people may be very successful at it while others may fail catastrophically. If you are thinking about getting into it, here are a few advantages and disadvantages that will help you decide if it really is the right investment for you.

First, the flexibility offered with real estate investing is incredible. Let\’s face it, most investments require a person to constantly be observing them and making changes to prevent any losses. However, with property investing, you won\’t get too stressed when it comes to maintenance. When you\’re starting out, you have to get the right property, letting agents, marketers and other people to help you get the right property and tenants. Afterwards, you can decide to either take a hands on or off approach. With the latter, you will have to employ a property manager. By choosing this option, you can sit back and collect your checks in the mail every month.

Investing in property also won\’t require you to dig too deep to raise the funds. Whereas it is difficult to get loans to invest in stocks and other options, banks will easily give you mortgage loans. This of course depends on your credit rating. Once you\’ve gotten the loan, you can structure the payments to your liking. Some people choose to let the house pay for itself by setting the repayment amount equal to the rent they are receiving.

The high returns offered are also an incentive to most investors. Land is almost always appreciating in value. Therefore, the prices of houses are usually on the rise. If a property\’s value increases by even a single digit percentage, then the gains are considerable.

Tax benefits are also an added benefit with property investing. A property owner is allowed to include all the house\’s expenses as tax deductibles. These include maintenance and repair charges, property management fees and interest accrued on the loan taken to purchase the property.

Looking at the disadvantages, we see that investors aren\’t fully guaranteed that their investment will bring in decent returns. Yes, the value of land is constantly rising, but other market factors can come into play. The 2008 financial crisis did severe damage to the housing sector which still hasn\’t recovered. In fact, a large percentage of houses were foreclosed after the crisis.

Another disadvantage is the liquidity. Property generally has very low liquidity. This means it does not make a good short term investment. A number of investors only want to put their money in places where they know they can easily obtain it in case of emergency. However, when it comes to selling property, it may take a number of months, especially if it is in a bad economy.

Furthermore, houses are expensive to maintain. Many real estate investors say that a house won\’t bother you a lot, but when it starts getting problems, you should be ready to dig deep into your pocket. If a person had multiple real estate investments, their maintenance cost could be a little overwhelming.

Real estate professional offering selling service to Pickering real estate agents via advance web and other media giving your Ajax real estate home the maximum exposure and offering a free home evaluation.

Are you looking for a new Whibty real estate? Make sure you get enough information from friends, relatives or online resources about Ajax, Whitby as well as Pickering real estate information before you make any decision.
http://www.corinneandmichael.com

Author Bio: Real estate professional offering selling service to Pickering real estate agents via advance web and other media giving your Ajax real estate home the maximum exposure and offering a free home evaluation.

Category: Real Estate
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