1. Accessible

Real estate is easy to find and understand. It’s also one of the few investments where most buyers have access to financing through lenders. Since real estate is an insurable asset, lenders feel secure putting in up to 80–95% of the value of the asset.

2. Appreciable

Real estate has historically appreciated over the long term — the value of the property increases over time. This is due to two things: general inflation in the cost of construction and materials, and increasing demand as populations tend to grow.

3. Leverageable

Most people buy real estate by putting down only a portion of the cost (5–20%) but still see appreciation on the full value of the property. For example, if you bought a house for $300,000 with a 20% down payment ($60,000) and the property went up 5%, that would be a return of $15,000 on an initial investment of $60,000. Once equity is built up, owners can also leverage the investment for cash — either by getting a loan against the increased equity or by refinancing — which means accessing the cash in the house without having to sell it.

4. Rentable

Because properties are rentable, you can have renters pay down the debt and build equity for you. This creates a return that can appreciate as rents rise over the long term, along with debt paydown and positive cash flow.

5. Improvable

As a tangible asset, real estate can be increased in value through improvements — either by the owner (sweat equity) or by bringing in contractors. You can directly affect the value of your investment.

6. Tax benefits

There are tax benefits in the form of deductions and depreciation that can lower your taxable income. Deductions let investors claim expenses from renting — upkeep, maintenance, improvements, mortgage interest, and so on. Depreciation lets investors depreciate the value of the property over time to reduce taxable income. Consult an accountant for the details.

7. Stable

Real estate tends to be a stable, less volatile investment, as property values have historically been slow to rise and slow to fall — which can make it a good avenue for investors looking for lower risk.

8. Livable

Your own house can serve as an investment tool and a way to build wealth while still putting a roof over your head. Often investors will live in a home for a few years, then move into another while renting the first one out — continuing to build wealth while still using their investment as a place to live.

If you’re thinking of investing in the market, or selling, get in touch and we can set up a no-obligation meeting to discuss the best way forward.