The answer is simple. One word: control. There is no other investment opportunity that offers control over the aspects involved to make money and keep it.
Many people believe that investing is risky because you have no control over the assets in which they invest. There is very little control over savings, stocks, bonds, and mutual funds.
CONTROL = LITTLE RISK
People are concerned about job security because they have no control over their use. Few employees exercise control over the property of the company; how many pay taxes or the future of their employment.
In addition to control, real estate offers many other advantages. With adequate property purchase price and funding, if the property is in a good location and is well managed, the following advantages of real estate can be found.
- Cash Flow: cash is received each month.
- Leverage: banks lining up to lend money to be investing in properties.
- Amortization: tenants pay the debt.
- Depreciation: the government offers tax shelters because the bin roots lose value. However this is not common. Actually, the reason that the government provides incentives for depreciation is that real estate investors provide housing.
- Creativity: the value of the property increases thanks to creativity. For example, if you buy a plot of land, you can change the zoning classification; or if you buy an old house you can remodel; or you can buy an apartment and sell it as individual condos.
- Expansion: when learning to buy individual houses start by buying housing units.
- Prediction: it takes about a year to stabilize an apartment complex after buying it. After that year, management can get rid of bad tenants, keep good tenants who wish to make renovations, and slowly raise the rent. Once the property is stabilized, checks start coming in like clockwork. This is certainly better than the vagaries of the stock market: feel good when prices rise and bad when they fall.
- Deferred Taxes: One of the greatest advantages of real estate are deferred taxes. There are many ways a real estate investor can legally avoid paying taxes indefinitely, where money can be reinvested without paying taxes.
They key to success in real estate is good administration in stocks, bonds, and mutual funds.
At SILMEXICO, with our investment plan, we have a wide range of properties and professionals in our portfolio which allows us to advise and provide the best services to our clients.
Because good governance is the key to success in real estate, some of the best opportunities arise to buy properties whose owners were bad managers.
The ability to defer taxes is not available to those who invest in stocks, bonds and mutual funds. You’d be surprised how fast you can get rich if you do not pay taxes.