Ali Ata: The Pros and Cons of Real Estate Investments
Real estate properties are among the most stable types of
investment, but they’re not for everyone. Before you decide to put your stakes
on real estate, experts like Ali Ata recommend understanding the advantages and
disadvantages of this type of investment.
Here are the benefits of investing in real estate:
1.
Real estate properties appreciate over time. Their value tends to increase the longer you own them, unlike the
value of most machines, such as cars.
2.
You get a tax incentive for owning property. If the value of your property does drop, you may be entitled to
incentives that can lighten your tax burden.
3.
It’s a good source of passive income. If
you’re not using your property personally, you can have it rented or leased to
tenants.
4.
It’s ideal for retirement. Because real
estate investments tend to be long-term, you can use them to bulk up your
retirement fund.
However, investing in real estate also has these disadvantages:
1.
It requires a lot of time. As mentioned
above, real estate investments are long-term and will not offer significant
returns within three years or so.
2.
You can’t liquidate it when you need to.
Real estate is not a liquid asset and cannot be readily converted to cash. It’s
not the types of investment you should take if you expect many sudden expenses.
3.
You may have to spend on maintenance.
Lack of maintenance lowers the value of property, so you need to allocate some
of your resources towards maintaining it.
4.
It can be risky. Because real estate is
long-term, you don’t really know if it’ll deliver your intended returns in the
future.
5.
Accidents are costly. You may incur some
liabilities over accidents in your property, even if you have nothing to with
them.
Ali Ata understands there’s much to gain and lose from real estate
investments. Make sure to carefully weigh the pros and cons to ensure that you
choose an option that’s right for you.
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