Welcome to Gaia! :: View User's Journal | Gaia Journals

http://www.youtube.com/watch?v=nFH8PV_jPLk

Investing Overview

Few people realize the work that goes into investing in real estate. Over time, this is a great way to build wealth and sustain a lifestyle. Many people are drawn to real estate investing because of passive income. This is income where the money keeps growing without time being put into the equation. There are a lot of advantages to passive income, and this is one of the reasons why investors are so drawn to real estate. Investing in real estate has four main advantages.

Cashflow

Amortization

Depreciation

Appreciation

Developing a Plan

As an investor, it is vital to develop a plan when investing. There are a lot of people who simply start investing to try and make something happen. If you want to take the next step with your investments, there are a lot of things to keep in mind during the process. Not only do you need to think about the long term, but there are financing or cash requirements in the short term as well.

The Benefits of Real Estate

There are a lot of benefits to investing in real estate versus other asset classes. Over the long term, real estate tends to appreciate as you build up wealth. In addition, there are a lot of people who enjoy buying and owning real estate. Anyone who wants to take the next step with their wealth should look to this asset class as a way to build up their portfolio. Managing cash flow and tenants is difficult, but over time investing in this area is one of the best things that you can do for your money. Always keep the long term in mind when it comes to investing.

Cashflow

Earning cashflow every month is one of the best things about real estate investing. Many people assume that rent - mortgage is equal to your monthly cashflow. However, there are a lot of other expenses to keep in mind when renting out a property. A good rule of thumb is https://en.wikipedia.org/wiki/Real_estate the rate of appreciation in stocks.

Location

Quality

Economic Conditions

Age of Home

Appreciation Over Time

There are a lot of factors that influence appreciation over time. As an investor, appreciation leads to a lot of paper gains in your net worth. One of the benefits of real estate investing is the fact that you are able to leverage a small amount of money to purchase a large asset. On a $200,000 home, an investor may only have to put down $40,000. This $200,000 may turn into a $350,000 property over a period of ten years. As the tenant pays down the principle balance, the property continues to build in value. Always look at the price of a home when you are spending money. Real estate investing can lead to financial independence, but it takes a lot of hard work over a long period of time http://www.marketwatch.com/real-estate to accomplish this goal.

http://hubpages.com/money/Is-Investing-in-Real-Estate-Worth-It