WHY YOU SHOULD INVEST IN REAL ESTATE

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Real estate investing has its advantages and disadvantages as an investment option. Factors affecting an individual’s compatibility to real estate investment could be interests, personality, risk tolerance, temperament and financial status. Some may be fine with the high volatility and risk factors for some investments while other are not. Fixed income conservative type of investment has its place among some individuals. However, real estate is still a great investment option whether you are thinking of it as the primary plan or as method to diversify your portfolio. 

Real estate continues to appeal to investors for because of high rate of value appreciation. To make a gain from an investment, the item you are intending to purchase must increase in value at a faster rate than the rate of inflation and interest rates on borrowed funds. Real estate prices will continue to rise the amount of land available remains fixed overtime. However, concentration in urban areas continues to push for land for construction. This has continued to put an upward pressure on demand with fixed supply. This ultimately leads to an ever increasing price of property.

Another factor that makes real estate a better investment choice is that you retain control over your investment. It is you who makes investment decisions as compared to other financial investment plans which require professional agent’s expertise. With real estate you remain with the power to decide when, where to buy and to sell.

… You can also think of investment in real estate as an effort to provide shelter, a basic human need…

Just note that real estate investment does put a strain on your liquidity. You will take more time trying to convert your asset to money again. Stocks, bonds and other commodities are easier to sell than real estate. You should also be ready to bear the headaches that come with real estate ownership. On the brighter side, you can hire an agent to bear the headache on your behalf. If you look at it, you realize that real estate is actually a nice investment plan.