There are a handful of advantages of investing in real
estate that trump stock investments. Obviously, the primary edge that stocks
has is liquidity – they’re relatively easy to sell quickly; but they are very
volatile and frankly: many stock investors tend to be very emotionally involved
while investing and therefore make clouded decisions. Real estate, on the other
hand, is much less volatile but is illiquid, causing many investors to hold the
property for several years to gain equity or sell the property.
But weighing in both the pros and cons, real estate
still holds the upper leg. For instance, a few more strengths include
depreciation write-off, tax deductions and the famous 1031 exchange where a
property owner can sell a property, buy a new property within a certain
time-frame and not pay capital gains tax!
Not to mention, you just can’t “beat the market” with
stocks or at least not consistently – it’s been proven (and being proven by
Warren Buffett right now; Click Here).
However, in real estate, we see people beat the market all the time flipping
houses – buying low, fixing up and selling high.
All-in-all, real estate is true equity that has
several tax advantages along with the ability to provide consistent good cash
flow for however long people will need a place to live (which is only growing).
To read more on this topic, check out the links below:
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