Today’s market provides various investment options such as stocks, real estate, bonds etc. The choice of investment in a particular asset depends on many factors, including, but not limited to, the capital involved, the risk appetite of the investor, expected returns and many more. In such a market, individuals prefer to invest in real estate since it is an excellent method to enhance income flow and ensure future sources of income.
This rising trend is why many retail and institutional investors prefer to invest in residential space, commercial real estate of sale and industrial property in Mohali. This is because purchasing a home is an ownership investment. It also creates rental income and profits at the conclusion of the investment horizon.
Comparison with other prominent investment options
Mutual fund/Stocks v. real estate investment
Choosing between these options is challenging as both are long-term investments with good returns. Real estate, however, is a fantastic inflation hedge. Property values and rental revenue rise parallel to inflation. In contrast, mutual funds are susceptible to higher inflation, which can diminish gains during such times. Then there are different tax advantages of real estate investing, such as deductions for mortgage interest, property taxes, depreciation and maintenance in tax liability. Mutual fund investments have less tax benefits.
One thing to look at is the time-consuming aspect of real estate investment as a residential or commercial property requires proper management. This is not a requirement in a mutual fund investment.
Real estate investment v. gold
The value of both investments grows over time. Gold investment can be started with lower capital than real estate investment, which requires huge funds.
While investing in gold also provides good profits, you must wait for the price of gold to rise substantially above the invested amount. On the other hand, investing in real estate allows you to reap the benefits of passive income, for instance, by giving business space for rent and simultaneously waiting for the property price to rise. It’s also worth noting that the market value of gold changes daily, whereas the real estate market has comparatively low volatility.
Bond v. real estate investment
Bonds enable you to make a debt to a corporation or the government, which provides returns as interest payments and repayment of the principal amount upon maturity. Because it invests in government securities, this is the safest investment option. However, it is commonly known that the more significant the risk, the higher the reward. The overall yield on these bonds is relatively low, and the inflation rate can significantly influence their returns.
Real estate, on the other side, provides significantly larger earning potential and inflation-adjusted returns. This is because real estate gains more from inflation when construction costs go up. This increases the income by letting out business spaces for rent, thus providing incredible profit to investors!
Why Consider Real Estate Over All Investment Opportunities?
Let’s understand in depth the benefits offered by real estate investments over various investment opportunities.
Stable source of income
Rental housing demand has been growing in past years which is expected to continue for the coming year. This is contrary to an equity or gold investment, where prices keep changing daily, and demand in the market can be affected by a piece of news or comment from a celeb.
With the high employment rate in cities like Mohali, the demand for rental space is continuously rising. This renting out of the residential plots in Mohali is a good and stable source of generating passive income.
Let’s you authorize plenty of liquidity
Property can be a leverage as security for any type of loan. As these loans against the property (LAPs) are well secured, the interest rate on such loans is lower than an unsecured loan. Further, the loans backed by commercial property security are provided for a longer duration. In the past, real estate was a high-risk investment, however, times have significantly changed.
Allows leveraging your funds
One important advantage of buying a residential space or commercial real estate for sale is that residential space may be funded with any debt. Not like other assets such as mutual funds, bonds, or equities, one can buy real estate properties for more than his or her available capital. The scheme of down payments allows the investor to leverage his financial position for the time being.
In summary, real estate can help you diversify any investment portfolio and it will offset the effect of any volatile investment like equity funds and stocks. Similarly there are matters in question such as transparency and liquidity. Resulting the importance of due diligence, background checks and pricing comparisons that can not be magnified.
You must now pay heed to the fact that having already experienced a surge in property prices with the new Airport Road approval, investment in real estate in Mohali is undoubtedly a better option for individuals seeking to invest significant funds and expecting higher ROI.
Start your real estate investing in residential or commercial property at a prime location in Mohali with Aeropolis City.