fbpx
Three Key Advantages of Investing in Real Estate

Three Key Advantages of Investing in Real Estate

Just like with any investment avenue, real estate has its own advantages and disadvantages. The following are three key advantages associated with investing in property.

  1. Property is a tangible asset (when rented out and achieved rents are higher than associated costs).
  2. The use of leverage provides a basis where you can achieve potentially high investment returns; whilst also spreading out the risk across a mixed investment portfolio.
  3. Property investments act as a good hedge against rising inflation; which is mainly derived from the fact of fixed rental income over a number of years (leases are typically between 5-25 years in length); upward only rent reviews and property values having the tendency to appreciate with time.

 

As shown, real estate is not a simple investment platform where investors simply bundle together and “sit and wait” for their monetary investments to ripen. It requires effective property management (see point 1); market research and thorough due diligence across each perspective property (see points 2 and 3).

 

Source of information:

  1. Dix, R. (2016). Property Investment for Beginners. Wroclaw: CreateSpace Independent Publishing Platform.

Leave a Reply