Real Estate Investment
One of the most profit yielding investments today is from real estate investment. The earning potential of a smart real estate investor is extremely high, because real estate value does not typically decrease. When you are looking for a way to ensure your future security or to build a retirement portfolio, real estate investment is a good investment tools. Assuming that a real estate investor invest $10,000 or 10% in a down payment on a property and the real estate investor get bank loan for the remaining of 90%. If the real estate investor earn a 10% return, he will finish with $110,000.
House is one of the best and easier real estate investment you can make. House prices tend to rise over time. Home prices in the U.S. have risen 2.5% to 6.0% a year for the past 20 years. That trend is likely to continue for the next 10 years. So if you buy a home now, you've put your capital in a safe real estate investment where it is likely to grow. Invest in real estate can help you reduce the amount of tax that suppose to pay. You can deduct the interest you pay on your real estate from your taxable income. The value of this tax break depends on factors like your personal tax bracket, the size of your real estate, the rate of interest you pay on it and how long you've held the real estate. As a rule, the newer the real estate, the greater the amount of interest you pay each month and the bigger the tax break. Therefore, recent buyers with young real estate tend to get the greatest benefit.
You are owning property.
Property investment make you be
the owner for a piece of real property rather than putting
money in a landlord's pocket every month. The property
renting cost is normally higher than the monthly instalment
payment. There is also an opportunity cost equal to the
amount you would gain by using the money to purchase a
property. With propert investment, you will have the stability
and emotional security of owning your own property. No
more worrying about dictatorial or negligent landlords,
rent increases or the possibility your building will be
sold and redeveloped. You'll be able to live in your house
as long as you like, fix your monthly payments for as
long as 30 years and you'll be in charge. Even if the
property you purchased did not appreciate in price, you
would be able to sell your property and recoup some of
the money you put into it.
How does interest rate affected your mortgage investment return.
Interest rates in the market today are very low. This was a golden opportunity for an real estate investor to invest in mortgage. The lower the interest rate, the less you actually pay for your mortgage and the sooner you can pay the mortgage off. An real estate investor can check with their nearest bank on how different mortgage loan interest rates affect the total cost of your mortgage and the time it takes to retire it. An real estate investor can use the equity in your mortgage for low-cost loans for other purposes. Real estate investor can access the paid-up equity you accumulate in your mortgage in the form of a mortgage equity loan or a mortgage equity line of credit. Because mortgage are secured, mortgage equity loans and mortgage equity lines of credit generally carry a lower interest rate than other types of consumer loans, such as auto loans. The interest on mortgage generally tax-deductible as well.