- Can you give a specific examples how investing in Real Estate can be helpful?- Can you give a specific examples how investing in Real Estate can be harmful?Please give me many points (more than 10)Thank you
Investing in real estate can be a gamble. There can be a major advantage to investing in real estate if you find property at a price low enough to result in a significant profit. For example, some investors buy real estate they intend to flip. Flipping can result in huge profits for investors. The property may be in foreclosure, in danger of foreclosure or needs little or no repair. You may purchase the property for much less than its value, repair or update it, and resell or flip it at a much higher selling price. Exercise extreme caution in this kind of venture. Investing in real estate has its disadvantages. Lending institutions are very careful about whom they lend to, often requiring a 20 percent or more down payment. Sometimes finding a loan for investment property presents a formidable task. Although Fannie Mae and Freddie Mac typically offer generous loans to eligible investors, not all investors meet eligibility requirements. You may find that securing financing for an investment property is all but impossible.
Real Estate is one of the few investments where you have some control over the value. You can't go add value to a stock (maybe if you're an employee, but not likely), but you can paint a house, update appliances, landscape, etc. to improve it's value. It's hard to insure a stock, but you can do that with real estate to protect your investment. Another positive is that you can make money with real estate even if there is no appreciation and no equity. What?!!?!? Yep - it can be done. Think lease options. You can depreciate real estate investments/rental properties and offset income from an employer or other businesses when filing taxes to reduce your tax liability. Do this by deducting expenses depreciation. You can defer taxes indefinitely in theory by using tax-deferred exchanges. You can invest in real estate using tax-exempt/deferred accounts like IRAs and reduce tax liability or eliminate it entirely. You can make money on the front-end and the back-end with real estate by creating a good deal so you profit when selling or flipping it, and then also by carrying paper (holding a mortgage) and collecting additional interest, on a property you don't even own anymore. You can even make money in real estate without any money of your own, or next to nothing. It's often overhyped, but it's possible... Drawbacks - if you hold real estate it's not very liquid so you can't cash out quickly. You can be exposed to liability that you wouldn't have with other types of investments, meaning if a tenant gets injured due to accidental negligence, you're still liable as the owner.
they ain't making any more land. you are looking for appreciation and most times it happens You are looking for positive rent or cash flow other than the first the opposite can also be true
You buy in a market that is appreciating, a positive. You buy in a market that you think will appreciate, but doesn't or stays the same, a negative.
There's an difficult to understand facet of the flipping industry that you simply could desire to seem into. It's discovering homes to turn for buyers who do not desire to need to manage men and women. You'd force across the proper neighborhoods, speak to men and women, discover the position that appears crappy however could simply desire a well cleansing. Then you'll positioned a agreement on it and promote the agreement instantly. Get worried in a truly property funding membership and get to grasp what is worried, however this perhaps the proper position for you. Unless of path you know the way to tear out a kitchen and substitute the home equipment and methods to do your possess rehab, and feature $50,000 to take a position, wherein case flipping could fairly give you the results you want. Also, if you are going to turn, you desire to do it to your vicinity, round the corner. You recognize your fatherland high-quality, do not begin someplace else.
