Why Should You Invest in Real Estate? Check Out These 10 Reasons

Real estate investments have been popular in the United States nowadays. In a 2015 survey conducted by Bankrate.com to 1,000 investors, they have found out that 27% of American investors prefer investing in real estate instead of cash and the stock market.

According to these investors, the tangible nature of real estate offers them more security and stability than the intangible nature of stocks and bonds.

Here are the ten reasons why you should invest in real estate:

Value Appreciation

The value of real estate properties will increase over time. The data of National Association of Realtors shows that there is a 6.4% average yearly increase of home rates from 1968 to 2004, without single decline throughout the duration.

Tangible Investment

Real estate is a tangible investment – something you can see and touch. Unlike shares and bonds, you can feel more secured with real investments. You can sell these properties, build a house or develop it into a commercial property.

Inheritable Wealth

If you have children, real estate properties are great assets that you can pass on to them. It is a treasure that grows in value over time. Your children can definitely benefit from these real estate properties in the future.


Investors can also have greater borrowing power when using the property as security rather than using a share portfolio. Real estate owners can leverage to increase returns and build more wealth. However, an investor should understand the risk of leveraging and how it may impact their investments.

Equity Amortization

One of the greatest advantages of investing in real estate is that the equity of the properties will continue to rise. If you pay the home monthly, then you will also build equity in the home every month. If you have decided to sell the home, you will take more profits.

Loan Collateral

Real estate properties are great collaterals for loan applications. With real estate, you can be able to increase your principal loan. You will have greater borrowing power.

Income Source

Basically, if you own real estate properties, you can be able to develop them into apartments, commercial properties and so on. These will be great sources of income. House for rent and commercial units are in-demand.


The rates of rents can escalate while the mortgage payments on properties remain stable. This will allow you better cash flow as there is no rise in expense for holding a property. Moreover, when the inflation increases, there will be more demand for renters.

Low-Interest Rates

Lenders are most likely to lend money to borrowers with real estate properties thank any other assets. They will lend a higher percentage of value, as high as 95% and with the lower interest rates than any other assets.

Tax Benefits

Real estate properties also benefit from capital gains tax. If you sell your home, you are no longer needed to pay any tax on the profit. Also, if you sell an investment property, you will only pay the capital gains tax on half of the profit.

These are just a few of the many reasons why you should invest in real estate.

7 Steps to Becoming a Real Estate Agent

In the United States, there are more than 2 million real estate licensees. Every year, the trend of becoming a real estate agent is rising popularity as the demand for real estate properties and investments are also increasing.

According to the Bureau of Labor Statistics, a real estate agent can earn an average of $45,610 per year.

If you want to become a real estate agents, follow these 7 steps:

Pass the General Requirements

Basically, you have to be at least 18 years old, a legal resident of your country and has no records of a criminal offense against the law.

Take Pre-Licensing Courses

You must undergo pre-licensing courses and training for you to learn about real estate principles. There is a required number of training hours. It can be taken by enrolling in certified institutions or through online. Pre-licensing courses cost from $200 to $300.

Pass the Licensing Exam

With everything you learned from the pre-licensing courses, you should take the exam and pass it. Licensing exams usually consists of two parts – federal real estate and general real estate laws and principles.

Get Licensed

If you passed the exam, then you are licensed. But before that, you have to activate your license through the real estate commission’s website in your state. You also have to pay for your membership to local multiple listing services.

Be a Realtor

You also have to earn the title ‘realtor’ by becoming a member of the National Association of Realtors (NAR). NAR membership allows you access to real estate market data, transaction management services and discounts on education courses, among others.

Join a Brokerage

The next step is to apply to a real estate brokerage, an agency for real estate agents and brokers. Brokers undergo at least three years real estate training and are licensed by the state to oversee real estate management and transactions.

Build Your Client

Lastly, build your client and your portfolio. Seek help from a mentor to help you find buyers and sellers. You can also count on your personal network, including friends and families for referrals.

6 Common Types of Real Estate Investments

Many people now are engaging in real estate investments. Apart from the fact that it is a tangible asset, owning a real estate property expands your sources of income. Plus, its value increases over time.

Here are the six types of real estate investments that you can make:

Residential Real Estate Investments

Residential real estate properties involve houses, apartments, inns and motels, townhouses and vacation houses. A person or family can rent one of these to live or stay. The rate of the rental depends on the length of their stay and the rental agreements.

Commercial Real Estate Investments

Commercial real estate properties include office buildings and skyscrapers. As an investor, you would allow small and large businesses to rent or use your property as their office or outlet. The rate depends on the agreement while the payment usually takes place every month.

Industrial Real Estate Investments

Industrial real estate properties include warehouses and other industrial facilities which can be leased to businesses and companies. These properties can be used as distribution centers, storage units, and other special purposes. You can also integrate maintenance services to increase returns of investments.

Retail Real Estate Investments

The common form of retail real estate properties is a shopping mall. Malls lease spaces to businesses. This includes food shops, dress outlets, jewelry shop and much more. Apart from the base rent, the landlord also enjoys a share of the sales generated by the tenant store.

Mixed-Use Real Estate Investments

Mixed-use real estate properties combine any of the preceding categories. For example, a university established a building that has classrooms, at the same time commercial and retail units for lease. The first half of the building contains classrooms for students, while the other half, which faces the outside of the campus has bank outlets, food stores and other businesses leasing.

Real Estate Investment Trusts

Lastly, you can invest in Real Estate Investment Trusts or REITs. Basically, you are buying shares of an investor or corporation that owns real estate properties. You will receive a dividend out from the income. Of course, you also have to deal with taxes.

What among these real estate investments do you want to start?

8 Tips for Selling Commercial Real Estate

To become a successful realtor, you need to start with small things like selling residential properties. The transition to dealing commercial properties can be tougher.

Follow these 8 tips in selling commercial real estate:

Look for Potential Buyers

First and foremost, you should have a target audience. Draft a list of your potential buyers with their personal information. It is important that you can establish a connection with them before you can start with the actual selling.

Understand their Needs

Ask them about their preferences, interests, and likes. You have to understand their specific needs for a commercial property. It is important that they feel that you understand them and that your primary goal is to help them, not to make a sell.

Prepare an Exceptional Presentation

Prepare a list of properties that is visually exceptional. You can present a catalog or use digital devices to shows photos and videos. Explain to them the strengths of the property, the benefits and the added value they can get.

Declare the Reasonable Price

Now, it’s time for you to declare the prices of the presented commercial properties. As a realtor, you have to be competitive but you do not need to overprice. Just give the right and reasonable price.

Engage in Digital Marketing

Another tip to improve your skills is to engage in various digital marketing strategies. You can take advantage of the power of social media, website marketing, and email marketing, among others in maximizing your exposure as a real estate agent.

Seek Professional Help

You can always seek the help of experienced brokers to help you with the selling process. Real estate professionals know how to find the right buyers, market the properties effectively and maintain good relationships with various clients.

Learn and Train Consistently

Look for training programs and opportunities that can help you better your skills. There are various organizations that train commercial real estate owners and investors.

Be Honest

Lastly, integrity always matter. The best way to maintain a good relationship with clients is by being honest. You should not break the trust that they invested on you.