Perhaps you are planning to invest in something to make a large chunk of money and I think that's a great idea. There are lots of ways you can invest your hard-earned money these days, in fact, I could give you some investment vehicle ideas.
However in this case, I'll give you some reasons why investing in real estate is a smarter way to do than to invest in some types of common investments. Here are my comparisons:
Some people save money in the bank. For me, saving your hard-earned money in the bank for the long term doesn't make any sense. Why? Because the return on secured investments is too low and the increasing cost of retirement is too high. More than half of all retirees 60 and older say Social Security is their main source of income. For me, that's sad!
Another reason is inflation. Let's say, you saved money in the bank and earned 2 to 3 percent interest, while the inflation rate is 7 to 14 percent. The money you have saved for years decreases in value. And that's why I always buy Robert Kiyosaki's opinion--that savers are losers.
On the other hand, saving is still a nice idea if, your main purpose is to just save it for a while until you find another investment asset that would generate positive cash flow.
Securities such as the stock market, oil and gas investments, equipment leases, precious metals, and rare coins are less appealing to many savvy investors. Why? Because many of these securities is risky or you must hold them for lengthy periods of time before you see any rise in value.
Wide fluctuations in the market also make it possible to lose all the money you invest--if you don't have financial education or you don't have a coach to teach you strategies on how to invest in such investment vehicles. I'm not saying don't invest in these kinds of investment vehicles, actually, these are great investment vehicles. What I'm saying is you have to know what you are doing. But still, for me, investing in real estate is more preferable.
So why real estate? Some of the wealthiest individuals in the 20th century made their fortunes in real estate. How? Real estate price have gone up on an almost an interrupted basis since the early 1800s. The only thing that has varied in the last 150 years or so in the amount of change each year. Periods of inflation and recession, and greater or lesser demand, have all affected the rate of increase in various times, but the long-term trend in real estate value has always been upward.
Like any business, supply and demand are the major factors that influence the price of real estate. When interest rates are high, the demand for homeownership goes down. This puts pressure on the rental market and causes rents to go up and rental occupancy rates to increase. In contrast, when interest rates are low, homeownership demand typically increases, causing home prices to increase.
Because of the interplay of this pattern, real estate will almost certainly continue to increase in value, over the long term. The rate of increase, of course, will vary based upon many factors.
Rents will probably go up in the years ahead at a faster rate than they have historically. That means using creative financing options, such as no down payment (which you can learn for free at www.carletonsheets.com), have the potential to create an even larger return on investment (ROI) for you.
Source: www.carletonsheets.com
Related books I recommend:
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