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Real-Estate-InvestingReal-estate-investing is one of the premier investment vehicles available today. Real estate has advantages over almost all other investments. One principal advantage of real-estate-investing is the use of leverage.You can buy real property for little or no money down.
In most other investments – securities (stocks and bonds), treasure bills, certificates of deposit, municipal bonds, precious metals and coins, antiques, jewelry, painting, and sports cards – purchase must be in cash. (Though, some investors are able to buy stocks on margin, but represents only a small number of stocks). Banks will lend you up to 90% of the appraised price of the property and a vendor financing or seller financing can be arranged for the balance.Any equity in the property will allow you to obtain a second mortgage or mezzanine financing to pay for closing costs and improvement expenses.
Strategies and Techniques of Real Estate Investing. Real estate like other investments has it own cycles. There are times when it is inherently advantageous to buy (buyer's market) and times when it is better to sell (seller's market). Numerous factors affect real estate prices and value. Accidents and natural disasters – fire, flood, earthquake and personal events are all factors that determine real estate values. Thus, it is possible to consistently buy real estate at less than appraised value with the resulting gain in equity. In addition, simple improvements can sharply increase the value of your investment. Benefit from Increase Appraised Value. As your real estate value increases due to natural inflationary growth of money supply, you can obtain bank refinancing thereby benefiting from the increase in equity. In most other investments, you must sell in order to realize any profits. Since banks use real estate as the principal basis for granting loans, smart real estate investing can be crucial to the overall value of your portfolio.
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