3 Main Reasons to Invest in Properties

As you know, Momentum Property Education loves properties. There are a number of reasons why we recommend this form of investing to everyone. Here are the 3 Main Reasons to Invest in Properties.

Passive income

For many people this is the main reason why they step into property market. Having an extra income — additional stream of money builds for you a an extra security ‘for a rainy day’. Additionally, as this is a passive income you can generate it with no or little extra time. Of course assuming you have a right systems in place (please check my yesterday’s article).

Capital Appreciation

Property values grow over time. Property market is affected by cycles but despite recessions and temporary falls, overall trend is always up. Capital appreciation is not only a great way to build your wealth but also it’s the way to protect your capital against inflation. As you can see in the chart from International Monetary Fund below you can see how house prices have shaped up during the last 20 years. You can also see how the recession in 2008/2010 has affected properties. Despite temporary dips the trend in prices is increasing.

Growing average house prices is one of the main Reasons to Invest in Properties
source: IMF.org

Low liquidity

If you compare properties to other assets, properties tie up investors cash tight. Sometimes it takes a very long time to sell them — especially if you compare it to trading stocks using HFT — High Frequency Trading. The consequence of the long process sell properties do not react to market fluctuations as fast other assets. That gives you a better predictability and time to react if market gets unstable. That is especially important if you are trading (or holding) high value properties.

Of course this is not a full list of reasons. There are many more and we will be covering them in other post on our blog so please stay tuned!

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