1. Rental properties create “cash flow.”
2. Excess cash flow can be reinvested either in mortgage pay-down or to buy more properties.
3. Your tenants pay your mortgage.
4. You can increase the value of your investment by making improvements.
5. Real estate appreciates and is a great hedge against inflation.
6. Tax benefits such as depreciation and mortgage interest deductions can reduce the taxes you pay.
7. Over time as rents increase, so does your income and cash flow.
The real benefits of real estate over stocks is the ability to “buy equity.” Buying “undervalued” properties or “adding value” via renovations and improvements can spike profitable returns.