Benefits of Investing in Real Estate

We all want to make the most of our investing ventures.  We shop around for the best return for our checking, savings, 401k and more.  When it comes to real estate, you also want the best return for the money invested in your own home.

And for many people, investing in real estate beyond their own home provides many additional benefits

Here Are Some Benefits and Advantages of Investing in Real Estate

Portfolio Diversification – Many investors follow experts’ advice to diversify from the typical stocks, bonds, mutual funds mix. This is a key benefit of investing in real estate. Gains made in real estate are often totally removed from what’s happening in the stock market, which can be an investing advantage.

Variety of Real Estate Investing Strategies – There’s a strong appeal and distinct advantage to investing in real estate. An investor has multiple investing strategy options. Some people acquire only single family homes to hold and rent for the long term. Others, especially those with construction and rehabbing skills, might be drawn to the fix and flip strategy. Finding property that has a value-add component is how an investor can force appreciation. With the right skill set and good advisors, an investor might focus on investments in commercial properties, multifamily, or even REITs or syndication.

Low Interest Rates – Borrowing to invest in Real Estate allows investors to leverage their resources, especially when rates and terms are favorable. Instead of buying a property outright, investors use “other people’s money” (OPM) to get started and/or scale a real estate investing portfolio.

Cash Flow – Cash flow is the bottom line income you realize after making mortgage payments and covering operating expenses. If the property is acquired wisely and managed well, a key benefit of investing in real estate is realizing an additional income stream from real estate. Many real estate investors see this as the number one advantage of investing in real estate. Some see real estate investing cash flow as passive income.

Inflation Hedge – As the economy expands and pushes inflation up, the demand for real estate increases…driving rents higher. The inflationary pressure is mostly passed on to the tenants. While this is happening, the asset is still paying for itself and cash flowing.

Passive Income – One of the greatest benefits of investing in real estate is that investors hope to create “passive income.” Passive income is “income that requires minimal labor to earn and maintain.” It is true that once a property is acquired, needed upgrades and improvements are taken care of, and management of the properties is wisely delegated, the income really is passive. For most investors, there’s considerable education, time and money invested along the way so the income seems a bit less passive. Yet, once the fundamentals are learned it becomes easier to grow and create more income following the same model, therefore it requires less time. Eventually, the property gets paid off and then the income increases as the payments decrease, leaving money to retire on or pass on as a legacy to family.

Tax Breaks, Deductions and Depreciation – As with any other type of business, there are many tax deductions and advantages related to the costs of owning and managing your properties. Your investment property can possibly be depreciated for many years, even decades. And there may be opportunities to defer capital gains tax by using 1031 exchanges. Always check with your financial and tax advisors for a complete understanding.

Appreciation – Because real estate values tend to increase over time, chances are your property will appreciate in value. So, when it comes time to sell, you’ve gained value and equity by holding onto the property-–another benefit of investing in real estate.

A Tangible Asset – Many investors appreciate owning assets they can see and feel-–another benefit of investing in real estate. And, they realize that real estate is a fairly safe investment because property is always and will always be needed. Unlike newer investment options like cryptocurrency, buildings and land are generally less prone to price and income fluctuation.

Control of Your Time, Your Life, Your Wealth – This is one of the most appealing benefits of investing in real estate–-the ability to be in charge of your own time and lifestyle. There’s a real freedom that comes with being your own boss and realizing passive income. Yet it might be best to transition over time from a full-time job working for someone else before jumping headfirst into running your own real estate investing business. If you need help transitioning to becoming an investor, get a coach or mentor who can help you develop the needed skills quickly. In fact, LeAnn Riley’s Proven Profit Formula Coaching Program can teach you how to get started investing in real estate in just 60 days. AND LeAnn will be there to guide you with weekly group coaching as you build a portfolio or acquire more properties. Once you’re set up with the proper knowledge, skills and systems, you could be on your way to freedom and wealth.

Real Estate Can be Refinanced – Owning real estate as it appreciates in value and is paid down through rental payments by the tenants creates equity. In a short time, especially in areas and markets that are going up in value, you create extra equity that can then be refinanced and used to purchase more property.

Real Estate Is Easily Insurable – A piece of property, land or a building can be insured…much different than an investment in the stock market. Rent out your unit(s) knowing that the investment is covered from many disasters and you are in control of whether it makes money or doesn’t. When investing in the stock market, you are counting on someone else to run your business and make money, but you have no control over whether that happens or not.

Challenges and Risks of Investing in Real Estate

Now that we’ve discussed the many advantages of investing in real estate, let’s take a quick look at the challenges and the risks. While it’s true that anyone can learn how to invest in real estate, many people think of this venture as easy to do with little thought to what they don’t know.

It’s best to seek out reliable sources of information, education, training and coaching. Talk to and/or hire advisors who have been successful in the industry, who know real estate and can advise you on how to negotiate deals and manage acquisitions. In addition, make sure your coach/trainer or mentor is someone who has actually invested in real estate. LeAnn Riley grew a multi-million-dollar portfolio of single family, multifamily, commercial and vacation rentals in several states. LeAnn Riley knows what it takes to get started and what it takes to scale a real estate investment portfolio.

It doesn’t take a huge mistake to result in a major financial setback. We’re talking real money being invested, and the downside is there’s always risk when investing. If you don’t know how to tell a good deal from a bad deal, you could end up losing a significant amount of money.

Real estate investing is a challenging business requiring planning, expertise and focus. It’s best to invest upfront in expert real estate investment training, so you are prepared to move ahead with a proven system and reliable tools to carry you through shifting markets. Consider LeAnn Riley’s Proven Profit Formula Coaching Program.

“Thank you, LeAnn, for helping us close on our third investment property.

Really appreciate your advice, help, teaching and learning!!”

Diana & Tomas

Key real estate investing risks include bad locations, negative cash flow, high vacancies, and problem tenants. Other risks include the lack of liquidity, hidden structural problems, and the unpredictable nature of the real estate market.

The good news is there are tried and true training programs like LeAnn Riley’s Proven Profit Formula Coaching Program. It’s a 7-Step online course you complete on your own time with the opportunity to ask questions of LeAnn as you go. The course provides the foundation and tools you need for a lifetime of successful investing. It can be completed in as little as 60 days, and will set you up for all the benefits and advantages of investing in real estate.

Best news of all is the opportunity to meet with LeAnn on a weekly group coaching call to discuss deals in detail, to problem solve and brainstorm. Your Proven Profit Formula Coaching Program community provides a trusted forum of like-minded investors going through the issues together.

It is in the community that you actually learn and practice the skills. Many students get their first property within 60 days. Then, there are tenants to deal with, rents to increases, repairs to handle and taking care of turning units.

If you purchase a property that has a value-add component-–like paint, carpet, stairways or appliances-–that would be considered value-add. The property now is worth more and can attract higher rents. All of this SOUNDS easy but new investors especially can get scared….they don’t know how to ask for more rent, they are timid. Coaching helps you become a strong and proactive owner of rental property. You learn quickly to optimize or shore up your investment. Basically, it is the fastest way to the greatest income stream.

Knowledge is power and money in the real estate investing business!

If you would like to learn more about the benefits of investing in real estate with LeAnn Riley contact us by booking a free strategy session now