Looking for incomparable fictional profits? .. Invest in real estate
The real estate sector has witnessed a boom in recent years despite the recurring financial crises and increasing inflation rates at the global level, which prompted investors to consider it as a lifeline to protect their savings from market risks.
We can see this even more clearly in the Middle East, where real estate prices rarely ever decrease.
If we take Dubai real estate market, for example, we find that even though experts have been saying for years that the city is experiencing a real estate bubble, prices rise again and again whenever they go down for a period of time.
On the other hand, a report published by a real estate company in Bahrain about the real estate market in the Kingdom, and in Saudi Arabia showed that the market has been witnessing a steady rise over the past few years. That may be due to the overall changes the countries are undergoing.
This, among other reasons, encourages people to invest in real estate in the region as return on investment is amongst the highest in the world.
Guaranteed financial income
One of the most prominent advantages of investing in real estate that distinguishes it from other forms of investment is the possibility of achieving a fixed monthly or annual return on investment (ROI).
This profit comes through leasing real estate units of different types to individuals or institutions in exchange for a fixed rental value determined in the contract between the two parties, and those may exceed the value of the interest an investor may receive from banks.
And now that most countries in the GCC have implemented real estate investment trust (REIT), this return on investment has been regulated in ways that benefit all parties.
Real estate investment often becomes a safe way to increase wealth over time, as it can provide cash flow for retirement.
One of the issues people face while setting their retirement plan is how to create a stream of income so that they do not have to work, and real estate alleviates this issue.
One of the advantages of investing in real estate is creating a stream of income. Moreover, real estate allows you more control over the outcome than any other investment.
What makes the Gulf states a perfect choice in this specific regard is that they feature lower real estate taxes and higher rental values.
When tenants pay the rent amount every month, and this amount features gradual raises over the years, it becomes a steady way for people to plan for retirement safely, away from the risk of profit or loss projects. Plus, by the time of retirement, the property will have probably increased or tripled in value.
Build your Equity: Property Appreciation
Real estate is an asset that is part of your net worth; Real estate property appreciates in value on a regular basis. When your property does appreciate, the increase in value increases your equity as a result.
when you take a mortgage part of it goes on paying the interest of the loan and the other part goes on paying the principal value of the property. The downpayment you have put on to take the mortgage is your equity.
If your lease this property, the rental income will pay for the mortgage and sometimes there will even be a leftover for maintenance, repairs and such.
At the end of the mortgage period, you will own the whole property, therefore increasing your equity.
This whole process goes much better and smoother when done in a steady real estate market, one where prices do not undergo violent changes up and down, such as the real estate market in the Gulf area.
Avoid inflation risks
Many financiers and venture capitalists were exposed to severe financial crises due to the economic muddling in many countries because of the global financial crisis when high inflation rates decreased the purchasing value of their money. This prompted many investors to move towards real estate investment, especially in the Middle East, because it is safer and more stable among the different investment patterns.
From all of the foregoing, we conclude that real estate investment occupies a prominent place among the investment patterns because it provides financial security for individuals and investors and preserves the purchasing value of funds in a constantly fluctuating world.
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