Many people avoid real estate investments because they think they are scary or that they need a lot of money to invest. Neither is true.
Diversifying your investment portfolio is essential. If all your investments are concentrated in one market, you could suffer a total loss in the blink of an eye.
If you are thinking of investing in real estate, Tulum is without a doubt the place to be thanks to its high rate of return on investment coupled with its popularity among celebrities and tourists from all over the world, as well as its eco-sustainable vision. These are the main reasons why you should consider it, even if you have never invested in real estate before.
Increase appreciation
Unlike stocks or bonds, you can force real estate to appreciate in value.
First, real estate appreciates naturally. On average, real estate appreciates by 3% to 5% per year without holding the house. But it is possible to increase the appreciation rate by making renovations or repairs.
Not all renovations increase the value of a home, so if you are doing renovations to increase its value, some renovations can return up to 80% - 90% of the money invested.
You can feel financially secure
There's not much to feel secure about when investing in the market. But, as 2020 proved with the COVID-19 pandemic and the crisis generated, everything can change in the blink of an eye. One moment you have a major investment, and the next, you've lost it all.
When you invest in real estate for the long term, you know you have an asset that appreciates in value. Many people invest in real estate to supplement their retirement income. Whether you own the property while you are retired, getting the monthly cash flow from rent to supplement your income, or you sell a property you have owned for many years once you are retired and make a profit, you will increase your retirement income.
Some people feel more secure knowing that their money is invested in Real Estate rather than leaving it liquid in a cash account or investing it in the stock market.
Variety of ways to invest in Real Estate
Buying a property and renting it is the most common way to enter this world of investment but it is not the only one, there are many other ways to invest in real estate, such as:
Buying an undervalued property, fixing it up and flipping it (fix and flip).
Being a wholesaler who works as an intermediary between motivated sellers and a network of buyers.
Use "house hacking", i.e. buy a 1 to 4 unit property, live in one of them and rent out the others using the cash flow from the rentals to cover your mortgage.
Invest in a real estate investment fund.
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