Real Estate is one of the investment classes where smart investors can take advantage of the “negatives” to make more money.
High transaction costs and market inefficiencies, for example, are negatives that keep many people away from investing in real estate. But the best investors understand how to manage these “negatives” and leverage them to create higher profits.
Advantages and Disadvantages of Real Estate Investments
Here are 10 Advantages and Disadvantages of Real Estate Investments from our friends at RealEstate4Investing.com.
- Real Estate Can Be Easier to Understand
- Real Estate Is Improvable
- Real Estate is a Hedge Against Inflation
- Real Estate Properties Exist in an Inefficient Market
- Real Estate Can Be Financed and Leveraged
- Real Estate Has Higher Transaction Costs
- Real Estate Has Low Liquidity
- Real Estate Requires Management and Maintenance
- Real Estate Markets Have Significant Inefficiencies
- Real Estate Creates Liabilities
Why Do Investors Make More Money with the “Negatives”?
The negatives of real estate investing contribute to making these investments a stable, appreciating asset class for long-term investors. Therefore, the “negatives” of real estate investing become positives when approached from the proper perspective.
For example, the lack of liquidity and high cost of acquiring real estate limit the number of investors in this asset class and reduce the turnover ratio, resulting in stability and long-term appreciation that can produce higher profits.
Successful investors find the markets and specific properties to leverage the “negatives” of real estate investing and thereby make more money.
Graystone Investment Group
Graystone Investment Group LLC is designed to help new and seasoned investors find, rehab and manage investment properties. We have researched the Tampa Bay area neighborhood-by-neighborhood to determine where investments are likely to have the most return per capital.
Unlike other wholesaling groups, we find properties that we resell to investors at discount prices, while also connecting them with private financing. We also coordinate with rehab and management companies we’ve worked with for years, at no extra charge.