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Why Real Estate Investment Is the Best Strategy at Times of Adversity

Mature Couple Standing Outside House Looking At Property DetailsThe ongoing coronavirus pandemic has shown how quickly things can change within weeks, let alone months. These times have changed so many aspects of our lives, including investing in stock markets and other assets. When compared to other investments, purchasing real estate can still deliver outstanding value to you as an investor. You have to know what you are doing. Making smart decisions on the real estate market can be especially lucrative in these times. In this article, Upkeep Media inc. goes over the top reasons why real estate investment is the best strategy at times of adversity. You’ll learn about the advantages of buying properties during uncertain times and why real estate tops other assets in terms of long-term potential.

#1: Flexibility of Rental Properties

Open living room and kitchen area of luxury homeShort-term rentals were significantly affected by the coronavirus crisis. Many landlords had built their strategy around getting a steady stream of guests from Airbnb and similar sites. However, the drop in tourism and general mobility crushed their revenue streams.

Tourism companies took a significant hit, and it’s tough for them to come up with entirely new strategies for their firms. You can’t start producing masks straight after years of selling tours. But rental property owners do have the luxury of being flexible to a certain point.

You can turn your short-term rental into a long-term property, or vice-versa. This is something that a lot of Airbnb hosts have already done. Converting the short-stay rental into a traditional rental property means a stable paycheck at the end of every month.

#2: Appreciation Is an Important Keyword

Real estate investments go hand in hand with the potential for appreciation. This is something that lures in most of the would-be real estate investors. Even at times of crisis, your property investment could still be making money for you down the road.

When you look at the big picture, property prices are going up. You may see some fluctuations here and there, but the overall trend is clear. Real estate appreciates over time, and you are bound to benefit from this phenomenon.

Should you wish to get the most out of appreciation, purchase a single-family home because this type of rental property has the best appreciation rates. Studies have shown that increase in value is higher compared to condos, townhouses, and multi-family homes.

Appreciation as a process does take some time. Depending on multiple factors and circumstances, you may have to wait anywhere between a few years and up to five years before a significant value gets added. Then you can start thinking about selling that property again if you wish to do so.

#3: Real Estate Investing Is a Passive Strategy

Hands holding up detailed reportInvestors love strategies that are as passive as possible unless they are looking to replace their day jobs. When you don’t have to put in too much time and effort, the reaped benefits feel even sweeter.

A real estate investment can be considered as a passive strategy. This is an excellent choice during a crisis when you may have other demands that won’t allow you to put in too much energy and time.

Now you may wonder how rental investing can be passive. Being a landlord comes with around-the-clock responsibilities. However, you can always hire a professional property management company.

For a fixed fee, you can forget about all the hassles that accompany the self-management of rental properties. You won’t have to worry about rent collection, tenant screening, evictions, nor advertising while experts are maintaining and growing your investment.

#4: Promise of a Stable Monthly Income

Woman analyzing budget while sitting at homeRental investments continue generating income even at times of crisis. While a pandemic may put some pressure on property owners, this is more than likely going to be a temporary issue. The missed rent payments are going to be received sooner or later.

The return on your rental investment is steady. When you have a fixed-term lease agreement, you can rest assured knowing that you’ll receive the monthly payments. Even after budgeting for mortgage, repairs, and maintenance, you can still gain a healthy profit each month.

Crisis means change. Even though there are a lot of changes taking place around us during the coronavirus pandemic, some people are still investing their hard-earned dollars in assets like real estate, bonds, and stocks. Real estate investment is one of the best strategies at times of crisis. That’s because it can be a passive strategy, provide a stable monthly income, and offer certain flexibility in the face of a changing economy.

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