Is real estate great for investment?

Investing is one thing many people should do more of. Many people have dreams and aspirations of becoming wealthier and affording whatever it is they fancy, but those dreams will simply be dreams if they don’t start investing their money. That being said, there are many outlets for investment and one of them is real estate.  

Before you buy a condo in Manila, you should know the advantages and benefits of investing in real estate so that you know what to expect and tailor your life plans around those expectations.


Tangible asset value

The first thing you need to know about investing in real estate, is that you’re going to be investing in a tangible asset. Real estate, whether its a property or land, provides you with a physical asset that has a specific and finite monetary value. Investing in tangible assets can be a wise decision because they are almost always easily transacted for some monetary value.

If you are looking to stay liquid and have physical assets you can use for trading or more investments, then real estate is the way to go.


You can use real estate to boost your cash flow

In connection with the previous entry, real estate properties can provide a boost to your cash flow. Since real estate is a tangible asset, you can immediately use it to make money. This is usually done by renting out the property you have invested in. Once you’re done paying for most of the bills related to your property, the rental income it will generate can be added to your cash flow. This means more money for you to work with per month and the best part of all is that rental income is passive by nature. 

By using property for rental income, you get a boost to your cash flow without much effort other than the initial investment endeavor and managing your tenants. The influx of money will also be stable and predictable than other means of making money, which helps you manage your funds better.                                                                                                                                                                                                                                                     

Real estate naturally appreciates

If you are already experienced in real estate investment or just a beginner, you must already understand that real estate is not a short-term investment plan or a get-rich quick type of scheme. In fact, one thing that makes real estate a great investment is that it appreciates over time. 

Sure, market forces can always cause a property’s value to fluctuate, but if you look at the long-term, around 20 years or more, your property will be worth way more than it is now. Prospective real estate investors should be ready to strap in for the long haul.


Investing in real estate is good for portfolio diversification

Portfolio diversification is important for any investor. If you aren’t familiar with what that is, it is the strategy of varying or diversifying the investments you make. Think about it as having eggs in many baskets instead of having all of them in just one basket. You can probably understand why this is important. Investing in just one thing is risky, and could leave you financially vulnerable when forces outside of your control start to work against you.

Given the many outlets for investments such as stocks, bonds, gold, and real estate, having some form of stake in many of them drives down the risk of your investment portfolio. As alluded to above, real estate is more stable and more liquid than other forms of investment which contributes to your financial security. 


You have control

Last but not least, investing in real estate for the purpose of making it your main source of income makes you the boss. Real estate investment is essentially a business. You have full control over your decisions, strategies, and eventually, your own successes and failures. 

Think about it, you choose the property you want to buy, what to do with it, and everything else in between. In other words, investing in real estate leaves you in charge of your future,  especially financially.

However, don’t readily assume that real estate investment will always generate wealth and equity for you. You still have to make the right decisions and make them consistently. Failing to do so can leave you with less wealth than you originally started with, but if you play your cards right you will definitely have no regrets.


Key Takeaway

The answer to the question posed by the title is not a simple yes or no. It will all depend on certain factors such as timing, market volatility, and more. If you’re not sure if the condo you’ve been looking at is a worthwhile investment, ask for some guidance from real estate brokers or financial advisors. That way, you can make a better investment decision.