Generating Real Income with Real Estate Investing
Everybody is looking for ways to make money. There are tons of entrepreneurs eager to profit from the latest business opportunity. One of the most successful and long lasting business opportunities is real estate investing. Real estate investing is not for everyone. You do need to be self-motivated and self-determined with a goal, an appetite for success, and able to handle risks. So if you are serious about having a successful business, making money and enjoying your life, then real estate investing is for you!
Here are the top reasons why real estate investing can work for you and bring you the income you’re looking for.
Real estate investing brings Immediate cash flow
We’ve all heard of business owners that started a business and it took years before they started seeing a cash flow coming in? This is the case with most conventional businesses. It can take quite awhile before income is coming in based on positive returns. However, investing in real estate properties can produce immediate income in months, even weeks. In fact, this is one of the main reasons most people get involved in real estate investing. The cash flow is not only immediate, but it provides for a continuous monthly income if you invest in the right kind of property at the right time.
The immediate cash flow provides a monthly flow of income that allows you the ability to invest in additional real estate properties, pay expenses or do whatever it is you like with your flow of income. Investing in apartments or low-income properties where people pay a monthly rent is key to bringing about an immediate cash flow. Although your mortgage payments on the property more than likely may stay the same, the monthly rent your tenants pay can gradually increase based on a number of factors determined by you. However, don’t be fooled or believe in fairy tales. You do have to work in order to see that immediate income coming in.
Real estate investing increases tax benefits
Next to making money, and making it quickly, one of the biggest advantages real estate investing brings is the deductions involved. One of the biggest perks of real estate investing is the fact that the government usually looks kindly upon those who buy and rent properties. That’s often not the case with many other businesses. Perhaps, it’s because it helps boost the economy or the housing market. Or maybe it helps house people who may rely on government subsidized housing or it helps the city from spending money fixing up or tearing down abandoned or dilapidated houses. Whatever the reason, the government rewards real estate investors with huge tax deductions and benefits.
So if you’re contemplating between starting a real estate investment business or opening a brick and mortar store or selling mobile bathtubs, we'd say your best bet is to go with real estate investing. What are some of the tax deductions? Think of all the repairs you performed on your property, as well as the amount you paid upfront. You can deduct the expenses of these repairs and the cost of the property on your taxes.
You can also deduct the expenses you incur from the actual rental income. Another tax benefit is that you don’t have to pay self-employment tax. This is not only a huge savings but it saves you from the headache of filling out additional tax forms. And when you sell the property the amount you receive for that purchase is taxed at a lower capital gains rate than regular income tax rates. It’s a win-win situation.
Real estate investing benefits your retirement
Saving for retirement is on the minds of most. It can be especially taxing for business owners or those who are self-employed for the simple fact that you have to design your own retirement plan, one is not provided for you by your employer. Real estate investing helps you save for your retirement plan since it allows for a great deal of tax deductions. That money can be used to go toward your retirement plan. If you have a self-directed IRA, you can also delay paying taxes on real estate profits from rental income and sales.
Real estate values are likely to appreciate over time
There are always changes in the housing market but for the most part, outside of a depression or severe recession, the market usually stays fairly consistent over time. The simple equation of supply and demand is always in play. The more people looking for houses or property, the better the opportunity. And people will always be looking for somewhere to live. So even when values decrease, over time it all evens itself out.
Real estate investing means control
Who doesn’t want control over their life? Investing in stocks and bonds really don’t give one the control they would like to have. However real estate investing allows you greater control over your investments and business. And as a business owner you definitely want as much control over how your business goes. Although you can’t control the housing market, you can control your property investments and how much you can make. With the right understanding about real estate investing, you will be able to research and find the right investments that will yield you the amount of money you’re looking for.
You will be able to determine the probability of profit based on expenses and how much the tenants will pay in monthly rent so you can make a profit. If you’re looking for a better deal, just go out and look for one. If the market gets competitive, increase your advertising. If property values drop, just hold off and wait until things smooth out. For the most part, you are in control of your financial success!
Although there are tremendous benefits associated with real estate investing, it IS work, and you must put the effort in to make it work for you. It’s a business and it must be treated as such. If you’re ready to step out and make things happen for yourself and your family, eReal Estate Investors offers tons of real estate investment courses to help you get started in your business venture and to succeed.
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By Erika Cox for eReal Estate Investors