We love rental properties. We STRONGLY believe that rental real estate should be a part of every investment portfolio. But why do we love them so much?
This is a great article by Forbes Magazine that outlines the benefits of rental properties. A good read that everyone should take a look at.
As the article states, there are five reasons you should be buying multiple rental properties.
- Equity Growth – Your mortgage is getting paid down each month by your tenants, and each your equity grows. This is equity that you can tap at a later date, or just create wealth to be passed on to your heirs.
- Appreciation – Real Estate markets go up and down, but in the long-term, your properties will appreciate in value. Nationally, home prices have increased 18.4% between 1980 and 2016.
- Cash flow – This is the main reason we love rentals, we call it mailbox money. Every month you get a check. For as long as you own the property. If you build a portfolio of investment properties, that monthly check can become very substantial, giving you more choices on the way you live your life.
- Tax Benefits – I am not going to go very deeply into this part because I am not a tax expert, you need to consult your own and see what will work for you, but the tax benefits can be substantial. The article give you some examples.
- Leverage – You can buy your properties with all cash, but smarter investors use leverage to build their portfolios quicker. You can buy a property for only 25% down. Even better, if you buy it correctly, you can refinance your property and get ALL of your money back out, and just buy another property. Then repeat that over and over again.
Here’s the article, take a look and let me know what you think: http://bit.ly/2z8W74n