Why Real Estate Is A Safe Bet For Older Investors
(Dreamstime)
Real Estate as a necessity might have seen a paradigm shift from being a middle-aged proposition to young buyer’s fancy but real estate as an investment continues to be the niche of older investors. Buying a property for end-use remains a priority for young investors who have started earning huge salaries but to be a serial investor, it’s not just the funds which are imperative but the experience and the patience are equally important. Here are a few reasons why real estate investments suit elderly investors.
Investors with experience can diversify their portfolio
Portfolio diversification in real estate is as important as choosing the right kind of asset for investment. Moreover, there is less risk when an investor forays into different types of the segment. Since there are different kinds of returns in every property segment, deriving returns from these segments can further lower the risk and investor can continue to earn hefty amount for a longer duration. In fact, for investors who are nearing retirement, investment diversification is more like a balancing act to neutralise the high-risk channels like stocks, mutual funds etc.
Older investors can manage their property to extract passive income
If you are investing in the property market to earn rental returns, there is an imperative need to manage and maintain the property and the tenants to earn the maximum returns plus the paperwork. While the young investors do not have the experience as well as the time to cope up with the rent collection or lease signing and other formalities, aged people have a bandwidth to manage their investment in a better way. The best idea is to get a property management agency which manages your property at a reasonable cost and still get a handful of cash in your hands.
Investors can mitigate risk through continuous evaluation of market
With age and experience, investors get the hang of real estate market and hence can evaluate risk at every point of the real estate cycle. A young investor won't has enough time and mind to give it to such high-value investment prospect. This is the reason why early investors are often advised to own gold, stocks, mutual funds etc while an older, mature investor prefers to go for the property market as an investment.
Apart from this, older investors are more resilient in nature than the younger ones.
These are some of the factors that prove that an older investor is better suited of real estate investment. It’s not just the matter of funds but also about the knowledge and experience that property investment demands which do not come with expert advice or suggestions but with self-education and understanding.
- by Surbhi Gupta
Source : PropTiger
Source : PropTiger
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