3 Benefits to Owning Rental Property

It’s difficult to take any positive news about real estate seriously these days. With the media and the government repeatedly bringing up how bad the situation really is, it can prove to be a real dampener for anyone who wants to invest in real estate.

But if you do understand that what goes up must come down and vice-versa, it wouldn’t be hard to notice that there are benefits involved, even if the situation seems bad.

So here are 3 benefits to owning rental property:

#1: Passive Monthly Income

Even if the rent that you make is only about $200-300 every month, it can turn out to be a lot over a few months. Rent, for all practical purposes, can be likened to a gift that you receive in the mailbox every month – and can be considered to be positive cash flow that will continue to flow in for as long as you live.

#2: Appreciation

As a rule, real estate tends to appreciate in value more than depreciate. Even during these tough financial times, income through rent can add to your net worth, which will be all the more satisfying especially if you’ve bought the property at a great price. Better still, when the property begins to appreciate, you’ll begin to see much greater gains too.

#3: Capital Gains Taxation

Usually, when you buy something that increases in value over a period of time, this falls under capital gains taxation, and which you’ll have to pay when you finally sell the property. However, thanks to a couple of quirks in the tax code, you can even get an extension, in terms of time, to pay capital gains tax, after you’ve sold the property.