The 5 UNFAIR Economic Advantages of Real Estate

Why is Real Estate is the Fastest & Safest way to Financial Security & Retirement?

As a Real Estate Broker and Real Estate Wealth Advisor, one of my primary goals when working with Buyers and Sellers is to educate them on how Real Estate is the Key to building non-employment income that never runs out and only goes up over time giving you a hedge against Inflation.  

If you are considering selling a home in order to buy another home, I urge you to contact me for a free consultation to analyze the possibility of you making your next purchase, while still keeping your existing home and converting it to a rental investment property.

SoCal Real Estate is the Safest and Fastest way to build wealth and financial security because of the 5 Unfair Economic Advantages of Real Estate that Financial Planners will never discuss and 95% of Real Estate Agents don't know or won't share with their clients.

Here are the 5 UNFAIR Economic Advantages of Real Estate that blow away 401K, Stocks, Bonds, Savings and Precious Metals:

1. Appreciation- This is the most common benefit the comes to mind for most people. What they don't realize is that Appreciation is really inflation or the devaluation of the dollar.  Inflation is either your best friend or your worst enemy.  If you own Assets such as Real Estate, Stocks, Bonds, 401K or Precious Metals you benefit from the inflation as prices/values go up. If you don't own assets, inflation will prevent future retirement.
2. Mortgage Pay Down- Think of this as Forced Savings.  Everyones goal should be to time the complete payoff of a mortgage on or before retirement age of 65 or whatever your retirement age goal is. As the loan balance goes down and value goes up, at retirement age you will have options as to how to use the equity in retirement.  One key strategy is to buy another home within 5-10 years and convert the first property into a rental. By taking advantage of the Utility Value of the Property, the mortgage is paid off by the tenant while the Landlord takes advantage of the Tax Benefits (interest expense, property tax and depreciation deductions) and Appreciation of Property Value.
3. Utility Value (Rental income)- Another Key reason real estate is the BEST investment is because of its inherent Utility Value which means someone will pay rent to LIVE in the home.  Stocks, Bonds, 401K, Savings and Precious Metals have NO Utility Value and taxes on Capital Gains taxes must be paid each year on April 15th.  Another unfair advantage is that over time rents will only increase in Orange County giving Landlords a Hedge against Inflation.
4. Unfair Tax Benefits- Real Estate offers several Unfair Tax Benefits when compared to Stocks, Bonds, 401K and Precious Metals.  As a primary residence, the Mortgage interest on the first 700,000 of mortgage debt and the property taxes can provide some large income tax deductions reducing the amount of Federal income taxes are paid to the IRS.  Additionally when the house is converted to a rental property, you now get to not only deduct the mortgage interest paid by the renters on your income taxes but also get to take a "Depreciation" Tax deduction on your tax returns offsetting the rental income.
5. Leverage- Last but not least is probably the biggest and most overlooked Unfair Advantage of real estate.  Appreciation in home values caused by inflation is the key reason for owning real estate. Using Leverage by borrowing money from a bank when purchasing a home is key compared to investing in Stocks, Bonds, 401K, Savings or Precious Metals.  If you want to buy any of these investments, you need to pay for them in full with cash funds you already have or slowly purchase them or save over time. Using leverage, in the past I have helped home buyers purchase Orange County homes with less than $5,000 out of their pockets. The key is that it is the house that is Appreciating at an Average of 7% per year in California and NOT the buyer's $5,000 investment at closing that generates a huge return on investment (ROI) in equity appreciating at 7% per year.

For a visual demontration of Why Real Estate is the Fastest Way to Build Wealth, check out the short video demonstration below presented by my Preferred Lending Partner, Mark Prather, Founder of Mark 1 Mortgage and the Mark 1 Real Estate Wealth Academy.

The bottom line is that it is basically impossible for 90% or more of Americans to save enough money for retirement due to Inflation that is baked into the system by the world monetary and banking systems. The days of pensions are mostly gone and most that exist today are underfunded.  Owning Real Estate is the Solution!

Starting with the purchase of your first home, real estate is a form of forced savings and a hedge against inflation.  While home values do go up and down, over the long term, they will only increase in Orange County.  On the other hand rent payments will never end and will only go up. 

If you are paying rent, you are making a mortgage payment but it's your Landlord's mortgage payment - not yours.  If you are buying your home and/or own rental property with the goal of paying them off you are on the right path to Financial Security and Retirement by taking advantage of the 5 UNFAIR Advantages of Real Estate, protecting yourself from inflation and creating a way to Retire Without Saving.

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