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Investing in real estate can be an effective way to create additional income today that can improve your financial stability in the future. Whether you choose to rent for long-term income or choose to flip a property for a quick profit, there are many great ways to make money buying investment properties. Let's look at some specific reasons why you should invest today.
Homes tend to increase in value over the period of time that you own them. Homes that are worth $100,000 today could easily be worth $200,000 or more 30 years from now depending on market conditions. This is in addition to any rent checks that you collect from tenants. Property values rarely correlate with stock and other commodity prices, so real estate can act as a buffer against downturns in other areas of your portfolio.
There are many tax breaks that may be available to the owner of an investment property. For instance, the cost of any work done to a home or portion of a home used as a rental generally qualifies as a tax write-off. You may be entitled to take a deduction for mortgage interest paid on any property used to generate income. If you transfer ownership of the home prior to your death, the beneficiary pays any capital gains taxes incurred.
If you ever have a problem before, during or after closing on a real estate deal, you may consider working with a legal professional. An attorney, like the professionals at Roderic H. Slayton, PC, may be helpful in sticky situations or if to answer general questions. An attorney may be able to help you understand basic legal terms or help with title or other disputes that may arise.
If you want to pass down a house or apartment complex to future generations, you are free to do so. This may make it easier for a child to gain some semblance of financial security at a relatively young age. Properties can either be transferred by a will or placed into a trust that dictates who owns them and how they are to be managed.
If you have wanted to buy an investment property, there is no reason to hesitate any longer. Those who are nervous about buying or developing a property on their own may wish to work with others who own investment properties. They may be able to share their own experiences or even act as a mentor.
Emma is a freelance writer currently living in Boston, MA. She writes most often on education and business. To see more from Emma, say hi on Twitter @EmmaSturgis2