“Don't wait to buy real estate, buy real estate and wait.” - T. Harv Eker
After the great recession of 2008 and the subsequent bailouts of financial institutions by the U.S. government, high net worth individuals (HNWIs) have lost faith in traditional financial instruments. Since then, HNWIs have been turning their attention to tangible assets such as real estate, as they promise greater returns compared to intangible assets. If that still doesn’t convince you, here are four solid reasons to invest in real estate according to leading real estate investment consultants in the United States.
1. Low Interest Rates
One of the key factors fueling the current boom in the real estate investment sector are low interest rates on home loans, which are expected to remain low in the foreseeable future. That is the reason why the returns realized by investors who invest in real estate usually outweigh the returns realized by investors in other investment vehicles.
2. Appreciation Over Time
Unlike investments in intangible assets, real estate investments provide an inflation hedge, protecting investors against inflation and resulting losses. Following the financial crisis of 2008, many investors changed gears to tangible assets such as real estate, given the appreciation in their value over the long haul.
3. Investor-Friendly Regulations
Recent regulatory rejigs in Asian countries, which financial observers termed “liberal” and “investor-friendly”, are another reason for investors to invest in the US real estate market. It is, however, advisable for foreign investors to partner with a US-based investment management company to minimize risks.
4. Low or Negative Yield on Government Bonds
Many investors are discouraged from investing in government bonds because of their low or negative yields. Bondholders are losing money in countries such as Switzerland and Germany through negative yields from these bonds. This provides another convincing reason to investors to turn towards real estate.
Summary
Given the above reasons, it would be safe to say that investments in the US real estate market are bound to grow in demand in times to come. Many real estate investment management companies will be seen playing a lead role and encouraging investors to invest in real estate. With handsome returns, real estate is one of the best sectors to invest in and create a continuous inflow of cash. Consult an investment specialist today to explore available investment opportunities in the US real estate market.
