Friday, January 24, 2020

Once again, real estate has come out on top as the “favored” best long-term investment. Every year, Gallup surveys Americans to determine their choice for the best long-term investment. Respondents are given a choice between real estate, stocks/mutual funds, gold, savings accounts/CDs, or bonds. This year’s results showed that 35% of Americans chose real estate, followed by stocks at 27%.

Real estate has outranked the other asset classes as the best long-term investment among Americans for the last 6 years. When done correctly, there is no doubt that real estate is one of the most popular and lucrative investments with a robust success rate. Real estate investing offers many advantages where investors can enjoy a steady income flow or tax advantage that improves their financial pursuits.

As an investment vehicle, real estate brings a diverse range of financial benefits to its owners. The steady cash-flow stream which comes in the form of monthly rental income is one of the cornerstones of buying properties. Investors are entitled to many tax benefits which help minimize expenses and maximize profits. With property appreciation, owners can sell their investment properties for a future gain, while capitalizing on market improvements. Real estate is an excellent “hedge” against inflation where investors are not as sensitive to market fluctuations.

Another extraordinary advantage is the leverage that is permitted when purchasing or owning property. To be able to acquire a real asset for twenty or thirty percent down payment with aggressive financing terms is unparalleled in the marketplace. It is like having a cash partner in the deal, without the headaches and heartaches of dealing with someone every time you want to make a decision.

Conversely, one of the advantages of investing in real estate is the ability to build equity. Equity is built through property appreciation as well as principal payments on the loan. Equity is a real asset that adds to your actual net worth. As you pay off your mortgage, you build equity. As you build equity, you now have the leverage to acquire additional rental properties or continue to improve your profits.

The real estate market is a lucrative business for many investors and entrepreneurs. Those that recognize and capitalize on the benefits of investing reap enduring financial rewards as well as financial security. For example, Section 1031 of the Internal Revenue Code allows you to postpone paying taxes on the sale of your property when you reinvest the gains in another property. This is truly an asset class of its own with diverse benefits and opportunities when done right!

It is now possible for the average “Joe Investor” to start building their real estate empire, without the typical “high net worth balance sheet” that was once demanded by local banks. In fact, mortgage bankers, such as Approved Funding can get investors the funding that they need to acquire buildings, or to cash-out on properties already owned - with little to limited experience and documentation requirement.

This is the perfect opportunity to make mention of the “Investing In Real Estate Workshop” that we are sponsoring for aspiring real estate investors and deal makers. I will be joined by several real estate authorities to share insights to both aspiring and savvy investors looking to get the inside deal on putting capital to work in today’s real estate market. This event will be Wednesday, July 24th at 7 pm in Teaneck, NJ. For more information visit www.approvedfunding.com/investorworkshop 

A very Happy Birthday shout-out to Terri Karasick, Elie Y. Katz (7/16), and Miriam Tennenbaum.

By Shmuel Shayowitz

Shmuel Shayowitz (NMLS#19871) is President and Chief Lending Officer at Approved Funding, a privately held local mortgage banker, and direct lender. Approved Funding is a mortgage company offering competitive interest rates as well as specialty niche programs on all types of Residential and Commercial properties. Shmuel has over 20 years of industry experience including licenses and certifications as a certified mortgage underwriter, residential review appraiser, a licensed real estate agent, and direct FHA specialized underwriter. He can be reached via email at [email protected]