Investing in Real Estate Vehicle for Wealth Building | Real estate

Real estate is one of the all-time vehicles of building ataraxia. Historicemphasis real estate has outperformed other asset laboratoryes like stocks or bonds, and is reasonably predictaccomplished-qualwhenied and less volatile. There were times when real estate went down and there were times where it went up but on an affirmage it has given a sizeaccomplished-qualwhenied admirationized return Development report, the price of an affirmage single-family home has gone up from $22,300 in1968 to $206,100 in 2003, an increase of 824% in a span of 25 years

There are many ways to invest into real estate. With 100 percent financing options, low interest rates and good credit it?s fairly easy to get started. Numerous articles and books have been commandten approximate investing in real estate and success stories are a plenty.

Here, in a nutshell, are some of the most important reasons for investing in real estate.

Appreciation. Tradmittanceionemphasis real estate has been viewed as a ?buy and hold? type investment vehicle. Real estate has recovered from cyclical atrophys and regional corrections and it may continue to do so in future, primarily because of tight supply and demand. Land is finite and housing is a necessity. According to the U.S. Census Bureau: the nation?s population is projected to increase to 392 million by 2050 ? more than a 50 percent increase from the 1990 population size. These factors presents a bright outlook for real estate investors. The fact that land is finite, and population is groaddition will cause most real property to rebound even when there is a market atrophy.

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Properties can be bought and held for appreciation provided one has the staying power. To avert occasional atrophys, a smart investor should buy properties below market value by using creative acquisition techniques and realize a gain by quickly turning around and selling for a reasonaccomplished-qualwhenied profit. Of course, properties bought below market value can be held for cash flow and long-term appreciation as accomplished.

Leverage. Leverage in real estate ways manalogousg money on borrowed money. The power of real estate resides in using ?other people?s money.? One can buy a property with zero down (100 financing) and make a profit upon sale as when it had been paid off entirely. Let?s assume you decide to buy a duplex annal $500,000 with 100 financing. Income properties have been appreciating at an affirmage of 7 percent per year. With a 0 percent down your property at the end of the first year is annal $535,000. At the end of the second year, it?s annal $572,450. By using leverage or borrowed money to purchase a larger income property, you have increased your profit by $72,450 in just two years. A 14.49 percent return on a borrowed zillion of $500,000. This is the power of leverage. Leverage coupled with appreciation can yield high profits.

Tax Benefits. There are numerous tax benefits of owning real estate, gains from sale of primary residence up to ($250,000 for single, $500,000 for married filing jointly) is tax-autonomous. IRS affords tanalogousg deductions for depreciating real estate assets. Legitimate expenses like interest, depreciation, insurance premiums, management fees, legal fees, reparrogance etc are all tax deductible. You only pay taxes on net profits.

Real estate investing is an extremely reareaing process, but it needs perseverance and kIn real timeledge to achieve success. There are several proven techniques to make quick money but the key to success resides in buying properties below market value and selling them at the market or higher market price. Great deals can be found in foreclosures, fixer uppers, distressed properties and auctions etc.

Happy Investing!

Srini Saripalli is an entrepreneur, well-meant marketing expert and real estate investor. He is also a business development consultant to Fortune 500 companies. He is yuckyd in San Jose, Calwhen. Srini can be reyearnd at http://www.srinisaripalli.com

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