Why Invest In Real Estate?

Why Real Estate?

Exploring Why Real Estate Is Always a Sound Investment

With the stock market reeling from the spread of COVID 19, many are discouraged from seeking investment opportunities. In a previous blog, we discussed the state of the real estate market as it relates to a potential economic crisis. There are several indicating factors that show an enormous discrepancy between market failure of 2008, and the current economic landscape. The current real estate market is not on the path to collapse. In fact, the damper on demand posed by COVID-19 creates an opportunity for prospective homebuyers to capitalize on and gain an advantage in a competitive market. The following will explore why real estate is still a sound investment. 

 

An Undeniable Upward Trajectory of Appreciation 

Unfortunately, the 2008 financial crisis has shadowed the real estate market with a damaged reputation in terms of return on investment. Economic crises have reshaped the mindset of many investors to be more skeptical of real estate investment. However, history shows that real estate is one of the most reliable investments one can make. Past bubbles have impacted the market for decades with one thing in common. The market has always recovered. When periods of boom and bust are graphed over time, an undeniable upward trajectory of appreciation is made obvious. With time, those who find themselves in a dampened market can still expect a sizable return on investment.

 

Real Estate Growth

The Tangible Nature of Real Estate 

Stemming from the steady aggregate increase in real estate values, the tangible nature of real estate renders it a safe investment even in times of economic uncertainty. Unlike the stock market which can dip to the point of bankruptcy for major financial institutions, real estate will always have a value. Land is a constant nonrenewable resource with a constant market value.

 

Diversification 

Diversification is also a key reason to invest in real estate. Ask any financial planner and they will tell you that it is absolutely essential to diversify your investments. Whether you are close to retirement, or you are a young adult new to investment, real estate provides a perfect way to diversify your portfolio. When looking at aggregate risk factors impacting investment, there is an enormous advantage to investing in real estate. As previously discussed, there is a steady increase in property value over time across the board. It cannot be understated how unique this is. Time does not impact investment risk in other investments like the stock market. External factors such as trade deals and fiscal policy rarely impact the housing market. 

The Bottom Line 

Most of all, real estate provides the most intangible assets. Ironically, the most tangible asset produces the most intangible returns. Intangible assets include family memories that take place inside many homes. For many, the home they grew up in is worth more than what’s listed on the price tag. Let Moayyer Real Estate help you find your dream home today, and get started making memories that will last a lifetime.

 

Sources: Harris, James. “5 Reasons Why Real Estate Is a Great Investment”. Entrepreneur November
16, 2017. https://www.entrepreneur.com/article/304860
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