Ever wondered most of the rich’s , corporate and high net worth individuals often pay stupendous prices to acquire a piece of land at sought after places? Well, one of the answers is to increase their wealth in the long term. According to Forbes highest number of wealthy people is produced by investing in real estate. Having a home is dream of any individual but, investing can significantly increase your financial status in long run. Here are a few reasons why you must consider investing in real estate now and how real estate investment for wealth generation helps:
- Investing in Real Estate is easy – Can you get a loan to buy shares of any company or to invest in an IPO ? No, right.! But, if you want to buy a property banks can easily provide loan as they know it’s a physical asset and no matter what, the prices will increase in future so, they find it safe to provide loan for real estate purchases. If you have a steady monthly income banks might be willing to give you loan at a lower interest rate and for longer tenure.
- Flip Value – Most people invest in real estate when the market is not performing well and they can get a property at a much lower rate than its actual worth or they buy a land that is not very strategic right now but they can improve it by making some improvements like constructing a new building, enhancing the landscapes or by building better connective paths. They do it for a reason – investment required in such realty is considerably low but once they are improved or waited for market to perform well, these properties can instantly give huge returns on investments
- For long term growth – These are the smartest kinds of investors and you must think about it well in advance before investing in a real estate. Historically, Properties that you hold for longer durations can never fail to give huge returns when sold. An easy example could be Jaipur’s Jagatpura area. The prices of land per sq. yd was approximately Rs. 2000 back in 2010 now after 10 years only the land prices are as high as Rs. 25000 per sq. ft. ( You do the math here) no fixed deposits or GPF or any other form of investment can promise such high returns. So, investing in a promising neighborhood at right time can multi fold your net worth if you hold the property for duration of 10 or more years.
- Cash Flow – The beauty of Real estate investments is they can be further leased for rental income or mortgaged for more borrowings from financial institutions. This way the property you have invested becomes an earning asset for you, if the location develops at a higher pace the property sometimes get more rentals than the installments you pay. As warren buffet says it’s a win win situation, he further adds “invest in land, god ain’t making more of it.!” Besides, real estate does promise various tax rebates which might help you keep more of your hard earned money with you then to pay it in form of taxes.
Conclusion – real estate investment for wealth – If you are in your 30’s and haven’t considered investing in real estate it’s high time. Investing in real estate is a sure way to make sure that your net worth shall be at least a few millions in coming 10-15 yrs. Long term holding of lands can be beneficial in tax and to generate supplementary income and finally the feeling of owning a land for yourself and your loved ones is priceless and very satisfying.
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