One of the best things about owning a home is building equity. Instead of throwing money away on rent each month, you are actually putting it toward your home. In the case that you wish to sell your home, you are then able to recoup some of this money to put toward your next home or another big purchase.
Keep in mind that the housing market can be unpredictable, so there is no guarantee that your house will greatly increase in value, though usually, that is the case.

If you are lucky enough to pay off your home, you can sell it and collect a large sum of money. You can take that money and put it toward retirement or use the equity to help you move to a nice home.

If you are fairly secure and certain that you will stay in your current job, it is a good idea to buy a home. Having a steady income will help you stick to your budget, pay your mortgage, and build equity. It will also prevent you from throwing away money on rent.

Everyone gets to the point where they want stability in their lives. Owning your own home gives you a set neighborhood, schools and community that you can call your own.

One of the standout benefits of buying off-plan is the access to property at below market value.

A property purchased today may not be due for completion until 2021. That means you could have two years of capital growth before you’re delivered a brand new property. This is a massive advantage if you’re looking for an investment you can turn around quickly.

Furthermore, some developers offer additional discounts to early investors. That means it can really pay to be the first person to buy.

Modern Technology

Technology is impacting property development in two fundamental ways. Firstly, improvements in digital marketing makes understanding what you’re buying easier than ever.

No longer do you have to stand in a concrete frame and imagine what it could be.

Secondly, investing in a new build usually means your property can be kitted out with the latest SMART technology. This kind of innovation is in demand by young professionals and first-time buyers, who are environmentally conscious, tech-savvy and want to control everything via their phone.

Tailored Properties

Typically, buying property comes with the choice of accepting someone else’s decor or paying to put your own stamp it. Buying off-plan gives you a third option to tailor your property’s design to one that suits you, while it’s being built.

This is important as it allows you to put the property on the market immediately after completion, whether you’re looking to attract buyers or tenants.

Plus, developers are typically pretty flexible on the design options they offer, with an option to suit every budget. You’ll also likely find that your chosen developer can organize a furniture pack for you that make your property ready to move into on day one.

Your Property is protected

One of the great fears of buying a property for you or as an investment is that it comes with loads of skeletons hidden in its closet. After all, no one wants to pick up the keys, only to find the roof needs replacing six months down the line.

Off-plan properties are brand new, so you shouldn’t expect any major costs anytime soon. Either way, in the event that something does go wrong, you’ll have likely received a structural warranty from the developer for up to ten years.

If you’re investing, this is a big weight off your shoulders, knowing that you don’t have a massive bill waiting around the corner. Of course, the details of this warranty will vary from developer to developer, so check the small print.

Simpler Buying Process

Buying off-plan is mutually beneficial for both buyer and developer. You get a great price on a new build and the developer has the peace of mind of one more property being sold.

For that reason, both sides want to make the buying process as simple and short as possible. You’ll usually find that developers have high-quality solicitors and other partners they can point you towards if you need one, and as it is a new build it’s unlikely you’ll be delayed by any problems uncovered when checks are conducted.

Plus, you’ll be dealing with professionals who understand the buying and selling process, so you won’t end up waiting on the seller to get their house in order… no pun intended.

Greater Breathing Space

When many people think about off-plan property, they often think of the time they have to wait for the build to complete as a negative.

In reality, though, this is a major advantage for nine out of ten investors, as it gives you plenty of time to organize your purchase. This eliminates the mad rush to complete all the paperwork that usually comes with purchasing property.

This is especially useful if you need time to restructure your existing portfolio and sell other properties.

Earn Passive Income for Life

The number one reason to invest in real estate is to generate a passive income for yourself so you can enjoy more of the things you want. However, not all real estate investments are created equal. Maybe you are hesitant to invest in real estate because you’re not looking for another full-time or part-time obligation. Maybe the thought of owning and maintaining an investment property on the other side of the country sounds daunting and difficult to do with your already busy schedule.

High Tangible Asset Value

Unlike stocks, and to some extent, bonds, an investment in real estate is backed by a high level of brick and mortar. This helps reduce the principal-agent conflict or the extent to which the interest of the investor is dependent on the integrity and competence of managers and debtors. Even real estate investment trusts (REITs), which are listed real estate securities, often have regulations that mandate a minimum percentage of profits be paid out as dividends.

Inflation Hedge

A long-term real estate investing strategy is an effective hedge against inflation because the value of this asset class has historically increased at a rate similar to the rate of inflation. You are thereby ensuring that your “real” or hard asset will help maintain your wealth and your standard of living. 

Increased Cash Flow

A fundamental benefit of real estate investing is its potential to generate income, especially over the long-term as your mortgage is paid down. The income generated from your investment property will often be sufficient to offset your mortgage payment, taxes, condominium fees and other expenses, while still providing you with increased monthly cash flow.

Your cash flow will be strengthened over time as you pay down your mortgage and funds can then be used to supplement your retirement income.

Real Estate is a Renewable Source of Capital

Investment real estate also provides you with a renewable source of capital through re-financing options, as property values increase and mortgage financing decreases over time. This renewability can effectively offset the potential diminishing capabilities of your RRSP.

Portfolio Diversification

Another benefit of investing in real estate is its diversification potential. Real estate has a low and in some cases negative, correlation with other major asset classes. This means the addition of real estate to a portfolio of diversified assets can lower portfolio volatility and provide a higher return per unit of risk.

Inflation Hedging

The inflation hedging capability of real estate stems from the positive relationship between GDP growth and the demand for real estate. As economies expand, the demand for real estate drives rents higher and this, in turn, translates into higher capital values. Therefore, real estate tends to maintain the purchasing power of capital by passing some of the inflationary pressure on to tenants and by incorporating some of the inflationary pressure in the form of capital appreciation.

The Bottom Line

Real estate is a distinct asset class that is simple to understand and can enhance the risk and return profile of an investor’s portfolio. On its own, real estate offers competitive risk-adjusted returns, with less principal-agent conflict and attractive income streams. It can also enhance a portfolio by lowering volatility through diversification. Though illiquidity can be a concern for some investors, there are ways to gain exposure to real estate yet reduce illiquidity and even bring it on-par with that of traditional asset classes.

The most serious showings tend to happen during the week. In many markets, it is usually too late to wait until the weekend to look at any properties of interest.

We all need to understand that every market is unique and real estate market is a magnet for discussion. Everyone loves sharing about their experience about it as it is one of the biggest investments of everyone’s life. Our suggestion to you will be to take an expert consultation before reaching to your final decision. Real Estate now has professionals from different industries joining in to help you understand the myths and facts of this sector.