While investing in construction of real estate properties does come with potential pitfalls and does require research, it can also bring plenty of cash to
your bank account. Here are some of the most important reasons to invest in real estate construction. (Just remember: Appreciation and cash flow
aren’t guaranteed. However, we help you research properties and neighbourhoods to increase your odds of generating a profit
Real estate construction projects are a way to boost your monthly income. Whether you invest in commercial real estate or residential construction projects, you can rent out your space to tenants once the facility is ready. You’ll then receive monthly income in the form of rent checks. We help our clients research the payment histories of your tenants if you want to reduce the chance of risk.
If the real estate you invested to construct increases in value over time, you can sell it for a solid profit. Remember, though: Appreciation isn’t guaranteed. We provide you full guidance in investing in the right property to see those big returns.
Construction of real estate projects is a long-term investment, meaning you can hold it for several years as you wait for it to appreciate. At the same time, if you rent out your real estate property once its ready you can earn monthly income while you wait for your property’s value to rise.
Investing in real estate construction projects comes with tax benefits. You can deduct several expenses associated with owning an investment property, including your property taxes, mortgage interest, property management fees, property insurance, the costs of on-going maintenance, the cost of repairs and the money you pay to market your property to potential renters. If you sell your property for more than you paid for it, the gain you realized won't be taxed as income. Instead, it will be taxed as capital gains, which typically come with lower tax rates than income. If you invest in neighbourhoods that are in need of investment – you'll pay even less in capital gains.
Adding real estate projects to your investments boosts your diversification, which can protect you in times of economic turmoil. Say certain stocks are suffering because of an economic downturn. The investment properties in your portfolio might still be increasing in value, protecting you from the losses your other investments are taking.
Investment properties bring much-desired passive income, that which you don’t have to work for every day. Say you charge rent on a single-family or multifamily property. The rent checks that come in each month are an example of passive income.
When investing in real estate projects you probably can’t afford to buy properties in full. After all, that single-family home you plan to rent might cost 300,000 euros or more. That’s where leverage comes in. Leverage in real estate means you’re using other people’s money to purchase properties. In this case, you’ll take out loans from banks, mortgage lenders or credit unions and pay them back over time. This allows you to add to your real estate project holdings without spending the full amount of money you’d need to buy them on your own.
Real estate investment projects are considered protection against inflation. When the prices of goods and services are rising, home values and rents typically increase, too. Investment properties, then, can provide you with rising monthly income and appreciation to help protect you financially when the costs of everything else are going up, too.
The big goal of real estate investing projects is to increase your cash, otherwise known as building capital. When you sell a property that has risen in value, you’ll boost your capital. The key, of course, is to invest in the right properties that will rise in value.
Owning investment properties comes with other benefits that aren’t financial. When you own investment real estate project, you are your own boss, which is fulfilling too many investors. You can also make a difference in your community, providing homes for renters or bringing businesses to commercial properties that will provide much-needed services to their communities.