Summer is a great time to relax on your porch, go to the pool, or grill with your friends. Whatever outdoor aspect of your home you’re enjoying, it’s also an ideal time to consider investing in real estate. Whether you’re looking to diversify your investment portfolio or add a continuous source of income, real estate investment has countless benefits. Keep reading for five of our favorite aspects of investing in real estate! 

1. Consistency & Appreciation 

Many investors’ favorite thing about real estate is its consistency. Compared to the stock market, the value of real estate is much more stable, with less notable daily changes in value. In addition, real estate is more likely to consistently appreciate. As population increases and certain areas become more sought-after, real estate continues to grow in demand. The average annual real estate return over the past 50 years is approximately 11%.  

2. Diversification

Real estate has low correlation with stock market performance, making it a good choice for those who want to diversify their portfolio. Historically, investors who have put a portion of their portfolio in real estate have been more successful than those who haven’t. 

3. Continous Income

Another great benefit of real estate investment is the potential for continuous cash flow. In many types of real estate ownership, such as equity ownership for apartment buildings earning income through rental payments or loans earning income through interest payments, the investor is able to earn cash while owning the real estate in addition to when they sell it.

4. Inflation Hedge

Real estate also has the ability to hedge against inflation. Since the supply of land is limited, it holds intrinsic value. Residential land values in the United States have increased by 169% in the past 20 years. There’s a positive relationship between  growth and real estate demand; as the economy grows, the value of real estate increases. In addition, growing demand for real estate both increases its value and its rental price potential. 

 5. Control Over Investment

When you buy a property, you have full control over your investment. From the type of property you buy, to the property financing method you choose, to making decisions about rent, you get to determine what’s right for you throughout the entire process. 

Overall, real estate is consistent in holding value, it will help to diversify your portfolio, it’s a potential source of continuous income, it can hedge against inflation, and it lets you have control over your investments. For these reasons and more, investing in real estate can be a great step to take.

Rick and Celeste

A LAUGH OR TWO FOR GOOD MEASURE

HELPFUL LIFE HACK #2

WHY INVEST IN REAL ESTATE?

Appreciation

Home appreciation relates to a house or investment property increasing in value over a period of time. A raised value of a property can lead to the owner making a profit upon selling it or earning more income through monthly rent from their tenants. Increasing home value also leads to more equity in the home.

Spring is in full swing. The sun is out, the birds are singing, and it’s time to start thinking about what to get mom for Mother’s day. 

Tax season is still fresh on your mind and you may be pondering how to improve your financial situation in the coming year. Have you considered investing in real estate?

If you have ever wanted to put your money to good use but were never sure where, real estate may be the answer. Here’s what you should know:

Why Invest in Real Estate

There is a common saying that 90% of all millionaires made their fortunes in real estate. Although it is hard to find reliable numbers confirming this statistic, it is certain that most wealthy people invest at least some chunk of their funds in real estate. 

But why is real estate such a good investment? Well, to answer this question, 3 characteristics of real estate investment need to be mentioned: passive cash flow, appreciation and tax benefits. 

Passive Income

Passive income is income for which the earner has to expend minimal effort after the initial investment. There are only 24 hours in a day, and if you rely exclusively on trading your time for income, the path to riches will be slow. True wealth is created by having multiple passive streams of income. Real estate is a prime source of passive income and,  seeing as it continues to be one of the most secure investments a person can make, it is a great option.

Appreciation

Sometimes properties lose value. But over time, the value of property generally increases. This increase in value is called appreciation. Appreciation can also be forced. This is usually done by making improvements to the property. Renovating apartments is a good example of forced appreciation. 

Tax Implications and Benefits

In both the US and Canada the government offers tax incentives to real estate investment, one of the most basic being deductions. Deductions may include such things as property insurance, mortgage interest, and property repairs. Owning or investing in real estate under a separate entity such as a limited liability company (LLC) can also increase the potential for tax benefits.  

Tax law regarding capital gains also works to greatly benefit the real estate investor as capital gains tax is substantially lower. Passively acquired income is taxed at a lower rate than actively accrued income.

Conclusion

Today, it is possible to earn an income by investing in real estate. Real estate investment has been reliable throughout history and the benefits of having passive income, appreciation in value, and tax benefits make real estate investment one of the most appealing ways to make your money work for you. Perhaps now is the time for you to start your investment. 

Celeste and Rick

A LAUGH OR TWO FOR GOOD MEASURE

HELPFUL LIFE HACK #2

WHY INVEST IN REAL ESTATE?

Forced appreciation

is when you, the investor, control the increase in value of a property. How can you increase the value of a property? You increase the value by increasing the money that your property generates, or the net operating income (NOI). You increase NOI by increasing income or decreasing expenses.

Hi everybody 😊,

Spring is so beautiful in this part of the world.  I feel grateful for the life that I have here every day.  Thank you for being a part of it.

Lately Rick and I have been living our best lives focusing mostly on business.  We are both feeling fulfilled and motivated by our work.  AZ Builders Services is  actively producing in different phases of at least five solid jobs, two of which are quite large.  Meanwhile, continuing to serve regular clients.  I am so proud of Rick and love seeing how he interacts with people so beautifully.  These are particularly challenging times in construction.  Supply chain issues are real and omnipresent.  A generation of skilled craftspeople are aging out of the work force while most young people have not gone into the trades.  We are learning to think differently.

The addition we built on HOMC Home Base is serving us righteously.  Having actual office space makes work something I want to do.  All these years of being a small time Landlady and remodeler have shown me that it’s time to up my game.  I’ve been spending a whole lot of time studying all things real estate.  I’m learning about all different kinds of financing, enter and exit strategies, management models, marketing techniques and more.  With that, I have been keeping a keen eye on offers and sales all around Arizona with a focus on finding off-market deals.  Lately, I have been in on the testing and troubleshooting phase of a powerful software called My Property Stats.  With it, I am having so much fun tweaking and comparing deal scenarios.  There are good deals out there to be crafted.  I am currently thick into purchase negotiations for one of them.  There appears to be a cool project on the horizon for the House of Many Colors.

Stay tuned weirdos.

Celeste and Rick

A LAUGH OR TWO FOR GOOD MEASURE

WHY INVEST IN REAL ESTATE?

Long-Term Security

Real estate is a long-term investment, meaning you can hold it for several years as you wait for it to appreciate. At the same time, if you rent out your real estate you can earn monthly income while you wait for your property’s value to rise.

Spring is springing!

Here in the southland, sunny weather and moderate temperatures allow us to enjoy a garden mostly year round.  We do need to take extra care during the hot hot summer months.  Here’s what’s going on in our little courtyard garden at the moment. 

Super sweet sugar snap peas are starting to pop out.  Green bell peppers are ripening to red.  Garlic and Shallots are fattening below the surface while their leaves help keep the rest of the garden pest-free.

And just look at this beautiful purple cauleflower!  It’s almost the size of a softball.  Basil is the real champ of this garden though.  We get to enjoy fresh pesto year round from this bushy bush. 

Enjoy your Spring time!

Rick and Celeste

A LAUGH OR TWO FOR GOOD MEASURE

HELPFUL LIFE HACK #2

WHY INVEST IN REAL ESTATE?

• Great Returns. …
• Long-Term Security. …
• Tax Advantages. …
• Diversification. …
• Passive Income. …
• Ability To Leverage Funds. …
• Protection Against Inflation.