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Posted almost 13 years ago

The Top 6 reasons to Buy n' hold

 Here's what Wall Street can't bring you...


 

The Top 6 Reason Why I Feel that Buying and Holding Properties is the best investment plan:

 

1) Hedge against inflation: While inflation is troublesome for many other business sectors, inflation  can be a good thing for owners of rental properties. Inflation will allow you to raise your rent higher than you normally could which in return increases the value of your property and allows you to pay off your mortgage faster.

2) Control: Unlike buying stocks, real estate purchases allow for you( or a relatively small number of partners) to have complete control over your asset. When you buy stocks, you have little knowledge of what is going on in the company's boardroom, and you  certainly cannot influence the companies actions or the results of their decisions.

3) Leverage: Real estate allows you to leverage your money in a way that many other investments will not . The ability to leverage your money will give you more opportunities to invest in other investment properties. Check out our post onto get an understanding of what leverage is.

4) Stability: The growth patterns of the real estate market are relatively steady compared to the stock market.  The real estate market is not nearly as volatile as the stock market.You don't have to worry about losing your life savings in the blink of an eye with real estate.

5) Cash flow: The money left over each month after you pay your operation expenses and mortgage payments is cash flow. This is a big advantage of investing in real estate. The cash flow that you get from your investments can  be saved up to invest in more properties.

6) Amortization: Each month, when you pay your mortgage payment, a portion of each payment is applied to the reduction of your mortgage balance. This known as amortization, and it will increase your equity in the property- thus creating an automatic savings plan. This is the silver lining of   investing in real estate.


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