Real estate can be a lucrative investment, and that is why many people choose to put their money into properties. Although I cannot give investment advice, I do want to point out some positive factors of real estate investing that cause many people to want in. People who invest in real estate tend to do so for one of a few reasons, and these are the biggest ones.
Hands-On or -Off
Real estate is one kind of investment where you can be as hands-on or hands-off as you want to be. If you want to invest in crowdfunded projects, you won’t have to do much work after the initial discovery and research. Those who like working on projects themselves can enter real estate development or flip houses. If you are somewhere in the middle, being a landlord can be a great trade-off.
While all investments are technically passive income, real estate is one investment that is as passive as they come. Particularly for landlords, most of the legwork is up-front, and then you can sit back and enjoy the income roll in. While there may be maintenance issues to deal with in any property, a good landlord will find the right tenants, who only call if there is a larger issue. Beyond that, many landlords choose to hire a property manager who takes care of all issues for them. This strategy is significantly less intensive than playing the stock market or watching cryptocurrency.
Returns and Risk
There is no way to guarantee returns on real estate investments, but knowledgeable people often make good returns that provide more capital for expanding the investment pool. Traditionally, the more risk there is in an investment, the higher chance for a good return. However, real estate can have less risk than business-based investments, with higher returns than safe savings-based investments. This is typically because real estate selling (and renting) price is basically a formula, and everyone needs a place to live. Although this primarily relies on the market and other national factors, people who plan strategically can find themselves in good shape.
Although real estate can crash and people can lose all of the money they put in, people who are in-the-know about the practices and trends of real estate often find themselves in a good position to make back what they put in. Again, I cannot provide advice on how to invest, but these points should at least make you consider whether real estate is a good option for you, or if you should take your money elsewhere.