Real Estate – The IDEAL Investment
Income
The author of “Rich Dad Poor Dad“, Robert Kiyosaki, generally defined an asset as an investment that carries you through scarce times by generating income. When you find a real estate asset that performs like an asset and not a liability, you are well on your way to riches.
Depreciation
Investors of wealth consider how their income will be taxed. With real estate you have the opportunity to depreciate the building over 27.5 years, offsetting a portion of the rental income and lowering your taxable income during the holding period.
Equity Build Up
Real Estate offers a balance of income and appreciation that will build equity for you over time with minimal tax costs. This is a great way to build wealth that can be transferred to future generations or cashed in as needed.
Appreciation
History will evidence that real estate values will appreciate over time for its owners and is subject to price influences such as speculation, interest rates, and fluctuating supply and demand. In growth markets such as Orlando, real estate tends to outperform other, non-growth markets as these price influences offer potential for excessive returns.
Leverage
Perhaps the most appealing aspect of real estate is its ability to attract inexpensive financing over long periods of time. You can dramatically increase your return on investment through a responsible amount of leverage. The combination of a rental income and fixed financing costs is also an excellent hedge against inflation.
