Buying a property is one of the most lucrative and complex forms of investment. There is no doubt about the fact that this particular investment has a lot of potential for success. Whether it’s about earning passive income by renting out your property or generating wealth through real estate value appreciation, property investment is beneficial in many ways. To guide you further in this regard, we’ve compiled some of the best reasons to invest in real estate and are sharing it with you in this blog. We hope that our findings help you make a potentially rewarding investment!

5 REASONS TO INVEST IN REAL ESTATE

Let’s take a look at some of the top benefits of real estate investing:

  • Immediate Results and Returns
  • Steady Income
  • High Tangible Asset Value
  • Increase In Value Over Time
  • More Control Over Your Investment

IMMEDIATE RESULTS AND RETURNS

Investing in rental properties is one of the biggest sources of generating passive income for property owners, not to mention that it is almost tax-free. Starting from the very first month, renters start paying a certain amount of money as the house rent as per the terms of the legal contract. It means you may not have to wait for years or even months to enjoy the return on your investment. In fact, you might start earning profit within days. Such quick returns, as we see in the case of renting out properties, are not guaranteed with any other types of investments.

STEADY INCOME

The inflow of a steady income is one of the key benefits of real estate investing. If you have invested in rental real estate and it starts paying you off every month, then you can also accumulate a good amount of wealth over a certain period, if everything goes according to plan. As mentioned above, a rental agreement bounds a tenant to pay rent either on a monthly, bi-annually, or annually for occupying a property, depending on the terms of the rental agreement. This results in a steady flow of rental income, making you, as a property investor, feel financially contended without requiring you to put in significant efforts. In case you have enough funds, try investing in rental properties as it may only result in more monthly income, which will not only let you tackle your expenses in a better way but will also allow you to save more.

HIGH TANGIBLE ASSET VALUE

The property you own will always be of value in the market. On the other hand, there are high chances that non-property investments may leave you with little to no tangible asset value, such as the worth of shares in a stock market which can dip to zero, or for instance, a new car, the value of which depreciates over time. On a side note, here are a few tips to increase the value of your home if you are looking to add more value to your investment.

You can also apply for a homeowner’s insurance plan, which usually acts as a protection shield for your investment in real estate, providing your property coverage from various unforeseen damages like a house fire and natural disasters, to name a few. Just to be sure that you are applying for the best policy available, do your research comprehensively.

INCREASE IN VALUE OVER TIME

Whether you have invested your money in a residential or commercial property, it has been widely observed that its value in the real estate market tends to increase over time. Factors that play an essential role in increasing the value of a property include urbanisation of a location, infrastructural improvements, construction of key neighbourhood amenities, and emergence of entertainment and recreation spots. Since the supply of land is limited and the demand for it continues to increase, the lack of space for the construction of new homes also significantly boosts the real estate value of a particular region. In such cases, real estate investment comes out at the top of the most lucrative investment opportunities.

MORE CONTROL OVER YOUR INVESTMENT

One of the key reasons to invest in real estate is that it comes with a minimum risk of loss, and your investment can’t disappear overnight. Furthermore, investing in real estate gives you more control over your investment since properties are tangible assets, which can be leveraged to capitalise on different revenue streams. You get the opportunity to build your wealth with better return rates and tax advantages.

Make sure that the time of your buying and selling property is right as the only way to lose money in real estate is by investing at the wrong time, which might leave you with a little-to-no profit margin. You need to be patient as big appreciations on real estate value often takes time, which means its better to hold on to your investment and wait for the right time.

This was our pick of some of the top reasons to invest in real estate. Let us know your thoughts about it and feel free to ask any questions related to our blog by emailing us at [email protected]. We will try to reply as soon as possible.

Meanwhile, if you are looking to invest in the real estate market, then these are some of the most common property scams in Pakistan that you should be aware of. Also, if you’re an investor, you can take a look at our H1 Real Estate Market Reports for Karachi, Lahore, and Islamabad to know more about the property market situation in Pakistan’s three big cities.