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Published On: Wed, Apr 3rd, 2019

Investment Guide for Millennials in the Real Estate

For Millennials, life is not limited to ‘work hard and party harder’. As responsible adults, they need to have an eye on the future too. And one of the most essential things for any millennial is to own his or her own home. For this, it is essential to understand the importance of investing in real estate properties.

Why invest in real estate?

As a millennial, the first question that may crop up in your mind is why invest in real estate at this stage in life, when you are not that financially secure, as is the financially-established older population. Of course, investing in real estate at this point in life may appear a struggle, but you need to start somewhere to invest in your future. And owning a piece of real estate in a younger profile has its benefits and is a great way to build a strong financial future.

Key benefits for Millennials investing in real estate

Let’s see some of the key benefits for investing in real estate:

  • Pocket the profits: As a sole owner of your piece of real estate, whatever profits accrue from renting it out, fixing it or selling it will go into your pocket. In case you have rented out the property, you get certain additional tax benefits too. You can then use the saved rent money to purchase additional properties for investment purposes, thereby increasing your monthly earnings.
  • Tax benefits: In addition to tax benefits on rent, you can also write off expenses associated with your rental property. You can also avail the benefits of 1031 Exchange coupled with a Section 121 for real estate taxes, in case you are planning to sell, buy or hold turnkey property.
  • Always in control: Owning properties means you have complete control over your portfolio. It allows you to purchase properties with the help of a trusted investment consultant for your specific needs, as also to achieve your financial goals.

photo 401K 2012/2013 via Flickr

Four important things about investing in real estate

#1 Make your investment strategy

Forming a real estate investment strategy will help you in determining the location, type and cost of property that is most suited for you. You have the choice of single and multi-family properties, syndications and Buy and Hold Turnkey funds.

  • Single and multi-family properties: This is a popular strategy that always remains in high demand. You not only get good pricing options, but also an opportunity for increased profitability.
  • Real estate syndications: Real estate syndications are where you pool in your money together with other investors to make the money flow in continuously. This option is ideal for passive investment strategy. The two types of real estate syndications are diversified single family funds and entitlement deals.
  • Buy and Hold Turnkey fund: This allows easy access to professional management services, increases liquidity and further diversifies your investment portfolio. The advantage of this strategy is it helps save money due to the lower purchase prices. It also attracts 25 percent increase in rental prices on completion of repairs.

#2 Evaluating financial strategy

Once you have determined which real estate investment strategy is most suitable for you, it is time to decide on a financial strategy. This requires analysis of your credit score and the amount you need to invest. If you have higher credit score, you stand a better chance of getting your financial loan pre-approved. As regards the amount you need to invest, it needs to be calculated taking into account 20 percent down payment, six-month emergency funds, monthly expenses, including mortgage, and, lastly, cash in hand.

#3 Identifying cities with a strong real estate market

Strong real estate markets don’t always exist in most popular cities. Certain factors need to be taken into account for identifying such markets that include population growth, job growth, rental demand and city revitalization.

#4 Consulting experienced investors

Since you, as a millennial, are new to real estate investing, it is a good idea to consult experienced investors. Alternatively, you can find a mentor or a trusted realtor for guidance. They will not only help you in forming the right strategies, but also in purchasing real estate investment properties.

Sunny Realty – Florida’s leading real estate agency

People, including Millennials, prefer warmer climes to spend their lives in. Of all the places, Florida offers them the most lucrative option. It is not only the conducive weather, but also low property taxes that makes Florida, specifically Miami and Sunny Isles Beach, a preferred choice for home buyers.

If you want to invest in real estate properties in Miami or Sunny Isles Beach in Florida, US, there is no better real estate agency than Sunny Realty to turn to. This leading real estate agency, based in Miami, boasts of having a finger on the pulse of the market to get you your dream home at the lowest possible price.

Why not visit Sunny Realty website that provides detailed information on real estate options in this ‘Sunshine state’.

Conclusion

For millennials, now is the time to invest in real estate. With the correct guidance of experienced investors and mentors, you can buy real estate properties as investments to achieve your current and financial goals.

Author: Merin Mathew

About the Author

- Outside contributors to the Dispatch are always welcome to offer their unique voices, contradictory opinions or presentation of information not included on the site.

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    […] Investment Guide for Millennials in the Real Estate | The. – Tax benefits: In addition to tax benefits on rent, you can also write off expenses associated with your rental property. You can also avail the benefits of 1031 exchange coupled with a Section 121 for. […]

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