If you’re watching the stock market right now, you might feel a bit sick to your stomach. You may be thinking you’d find a smoother ride at your local carnival or amusement park.
If you’re looking for a safer investment, you actually don’t need to look that far away particularly thanks to our government. The answer could be in your home!
The Bank of Canada recently slashed interest rates to their lowest levels since the 2008 recession, leading to lower lending costs. If you find yourself with cash to invest, and you’re not thrilled with the returns on Bay Street, one of the best ways you can shelter your money from the current storms is to invest in real estate.
Here are a few things to consider about real estate investing:
- In the US, there is only one year in the last 50 (2010) where national real estate prices deflated. In Canada, the picture isn’t quite as rosy but, as anyone who bought a Toronto-area bungalow in the 1980s can attest, most aren’t complaining about their results!
- Let’s say you put $25,000 in the stock market. $25k in stocks gets you…$25k, plus any gains. Or perhaps less if you lose some on a rainy day. Meanwhile, that same $25,000 could be a down payment on a home and a small reno budget. And you don’t have to leave the money sitting there for it to earn you money. With the right strategy, you can invest, renovate, flip the house for a profit, and keep building your down payment!
- Real estate is a tangible asset. You don’t have to worry about your house going out of business. Your house can’t catch COVID-19. If you’re insured, real estate will weather most of life’s storms.
Even as realtors, we have some money invested in the markets and sources other than real estate. A good investment strategy has many components to it, and even comparing stocks to real estate is like apples and oranges.
But, in our experience, real estate offers a strong return with a high degree of safety versus other options. Whether you buy and hold, flip properties, or even seek out options like real estate investment trusts (REITs), there are no shortage of ways to make money in real estate. As Mark Twain famously said, “Buy land. They aren’t making it anymore.”
Do you want to learn more? Interested in partnering with us to put our experience in real estate investing to the test? Want to check out one of our central Kingston properties that would make a perfect investment opportunity? 613-483-5444 or info@reri.ca.