On conversations with numerous business individual, James Jervis arrived at a conclusion that they want to diversify their business profits into more than just a savings account. If you are the one – pay close attention.
Investing in real estate isn’t always a wise decision but it is one of the best ways to build wealth over the long-haul, especially for business owners who want to diversify their income. Down below, James Jervis Investors have mentioned six lucrative reasons that will make invest in real estate properties.
Most of the people invest in real estate assets simply because of the cash flow – An additional income that is left after all the bills have been paid. The cash flow benefits you with ongoing, monthly income that is mostly passive, enabling you to utilize this income for – building a business, traveling or reinvesting in real estate.
Among other businesses investments, cash flow from real estate is stable and far more predictable. For startup businesses to endure the ups and downs of start-up life, real estate investment is a huge advantage.
Long-Term Tax Benefits
The federal government offers a lot of tax benefits on real estate investment that benefits you with lower tax-rates for long-term profits and enhance your overall earnings. You can take advantage of deducting all the expenses you incur from leasing the property from your rental income, including a large depreciation deduction from the amount you have invested in buying a real estate property. No doubt, rental income is also taxable but at a lower rate than other regular business income because it eliminates self-employment tax. Additionally, when you sell your real estate property, your gains are taxed at lower capital gains rates, rather than regular income tax rates.
The ability to leverage income effectively is to take help of an expert like James Jervis Investors that can create crucial investment growth strategy in order to gain a profit off someone else’s money. In case of real estate, “someone else” is the mortgage lender who finances your real estate assets. Investors who lease out property over the life of the mortgage can take advantage of paying off the debt incurred from purchasing the home via rental income. In the end, the real estate property will be paid off with only a small investment out of your pocket.
The symbolic benefit merges with real estate investment is the steady, long-term ROI – it creates. We do agree recessions can happen. Values go up and down but real estate is a consistently growing market that inflation over the long run. As the population continues to grow over time, so does the real estate values do climb higher and higher. In long term, real estate returns are comparable to the stock market, but that’s before factoring in additional tax savings on real estate.
Control over Your Investment
Both stock market and real estate may yield similar ROI but to have a better control over your investment, real estate investment seems to be a better option. When you buy a company’s stock, you have minimal ability to influence company decisions that could affect your investment. On the other hand, real estate investments have a far greater ability to influence your returns. You can take help of real estate expert who can research and help you choose the most profitable investments. No doubt, rental properties certainly demand a lot of work –through repairs, renovations and set rental rates but the payoff can be considerably more rewarding than stock market investments.
The Bottom Line
By owning some rentals, you are not going to begin building wealth immediately. Real estate investment is a lucrative decision – but only if you choose the right steps.