07/25/23

3 reasons why real estate remains a great investment

It’s time to share some good news when it comes to how Americans view real estate. Despite some of the widely publicized obstacles, property ownership is still considered the best long-term investment for many.  

That’s according to a recent Gallup poll. In it, 34% of Americans ranked real estate as the top choice for long-term investment in 2023, reflecting its perennial attraction as a safe and solid investment. In the multiple-choice survey, real estate beat out gold, stocks, savings accounts/CDs, bonds and cryptocurrency.    

While the figure is a dip from last year’s record-high of 45%, it’s the ninth straight year real estate has come in first. In addition, 34% is typical of the share real estate garnered annually before the pandemic. The bottom line is that even in the face of our current market conditions, real estate maintains its appeal for homeowners and investors alike. All of this underscores the enduring confidence in the sector’s robustness and stability and should be celebrated.

So, what makes real estate such a favorite? We’re glad you asked! In a recent blog, we wrote about the importance of home equity for homeowners, but here are three reasons owning real estate pays off for investors, too.

  • Diversification: Real estate is a tangible asset that diversifies any investment portfolio. This reduces risk by spreading your investments across different asset classes. Unlike potentially volatile stocks and cryptocurrencies, real estate offers more predictable returns, with properties often appreciating in value.
  • Cash flow: Rental properties can provide a steady income stream, supplementing your primary income. Additionally, the rent charged can increase over time, providing a hedge against inflation. Property ownership also provides tax benefits, such as deductions for mortgage interest, property taxes and maintenance expenses.
  • Long-term wealth building: Real estate, particularly when viewed as a long-term investment, helps build wealth. As you pay down your mortgage, you build equity in your property, which can be used to finance other investments or increase your net worth.

Interestingly, many people who don’t own a home yet also believe that real estate is a solid, safe investment. According to the Gallup poll, renters are just as likely to view property ownership as the top choice, reinforcing the wide-held belief in its investment potential. As other investment options fluctuate with economic cycles, real estate remains a pillar of stability and growth.

Whether you’re ready to buy your next home to live and build equity in or need a team to help guide your investment transaction to the finish line, our expert teams are here for you. Reach out to us today!

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