The one question that doesn’t seem to get old is this: Is investing in real estate still relevant? Still profitable? Some say the investment in real estate will never go out of fashion, while others claim that climbing mortgage rates will eventually put a full stop next to the whole thing. According to a survey, more than a quarter of the American population believes that real estate is the best investment option out there. It still ranks much higher than the percentage of people who consider stocks a better option. But regardless, times have seen a surge in a variety of investment modalities that are certainly rarer but gaining popularity among the public, such as fancy cars, cryptocurrency, and art. This article aims to determine the relevance of real estate in today’s investment market compared to its rival modalities.
Pros Of Real Estate Investment
In a way, real estate is much like dividend stocks, but without the annual payout. In fact, you can probably receive that as well if you lease your property. But the idea behind investing in real estate is that over the years, there has been a slow but gradual increase in the value of real estate. It’s also one of the most popular methods of inheriting assets, which means that properties that were owned by somebody’s forefathers over a hundred years ago are now basically a jackpot. The slow and steady rise in the price of real estate may seem mundane at first, but within the past forty years, there has been an increase of over 26% in terms of profit on real estate. That’s not nothing. Polls, surveys, and public tax data indicate that real estate is still a very relevant subject when it comes to public investments. In a way, real estate is the kind of wealth that you can control for the most part, as opposed to any other form of trading.
Cons Of Real Estate Investment
But the only real downside to investing in real estate is that if you prioritize asset liquidity, then this might not be the route for you. Buying and selling homes and buildings is not a slow process. While the profit can be exceptionally fulfilling, the process is no less tiring and demanding. So, if you prefer having your assets liquid, then investing in real estate may not be your best option. Real estate investment liquidity is heavily dependent on the market’s stability as well, so if it turns into a seller’s market you could end up waiting for months to sell your property.
Real Estate Investment Trusts
You don’t need to come out with a massive fund or wait for your savings to hit a point where you can leverage them to start buying yourself some property. The real estate investment trusts (REITs) are the perfect solution for those who are a bit low on funds but still want an into the game. Basically, instead of purchasing a building by paying a down payment upfront and investing all your money in it, you can partner up with a reputable real estate company. You can also invest in an REIT using your 401K account. If you use a traditional IRA, your contributions are deducted from the pension account and the taxes are deducted from the profit withdrawals.
Advantages Of Investing in REITs
The biggest plus of investing in REITs is that you don’t have to own the property, manage it, prune it, or sell it. All the steps from buying to selling are taken care of by whatever real estate company you choose to work with. Still, you get paid a decent sum for investing your money because the IRS has mandates that REITs must roll out 90% of their income to dividends, because this way investors can have a steady flow of cash that can be invested right back to grow the investment pool. It’s a really good approach that creates a win-win for both investment institutions as well as shareholders. In the real estate world, this is the closest you get to stability and minimal work, which returns in massive paychecks.
Forex Trading as An Alternative
But if you’re still not invested in the idea of buying or selling real estate, one of the amazing tools you can use to grow your financial portfolio includes growth stocks or perhaps forex trading. Trading tools like Maven Trading can fast-track you to the route of learning, and before long, you can have a relatively liquid option of investment that doesn’t take as long as real estate buying and selling to make serious money.
Conclusion
It doesn’t look like real estate’s popularity in the field of investment is going down any time soon. However, the modality of investment you choose depends entirely on your needs and if you don’t find the idea of fixed assets like real estate thrilling, then you can always consider Forex trading or cryptocurrency as a means to secure your financial future.
