Inflation is a real enemy of investment income, but real estate investment provides a proven hedge against inflation and also offers protection from stock market volatility. Read on to see how income producing investment properties can protect your money and provide secure, ongoing ROI that will outpace inflation.
Your Savings Account Is Not Safe
Most investors realize that buying stocks, bonds and mutual funds comes with significant risk, but even if you decide to keep your hard-earned cash in a savings or money market account, it is subject to the drain of inflation and can actually lose money over time. Defined as a sustained increase in the cost of goods and services over time, inflation can decimate your savings and/or retirement income and also erodes the value of a nation’s currency.
Fortunately, real estate investing offers a way to combat inflation and get around this harsh reality, while securing ongoing investment income at the same time. Here’s how it works:
“Real estate is a popular choice [to counteract the effects of inflation], not only because appreciation increases the resale value of the property over time, but because real estate can also be used to generate rental income”, wrote Investopedia. “Just as the value of the property rises with inflation, the amount tenants pay in rent can increase over time, enabling the income generated by an investment property to keep pace with the general rise in prices across the economy”.
This sounds great in theory, but what about investors who don’t really like the idea of being a landlord, or don’t have time to manage a rental property? That’s where turnkey vacation home rentals come into the picture and provide an alternative investment strategy that removes these concerns from the equation.
Investing in Turnkey Vacation Home Rentals
Designed to provide a worry-free real estate investment option, turnkey vacation home rental properties offer a solution for buyers who don’t want to deal with the hassles of maintaining, marketing, booking and cleaning an investment property. As with all real estate purchases, successful vacation home rentals require a fantastic location, followed closely by professional management and an impressive list of available amenities.
The beauty of this alternative investment is that buyers can expand their search for the perfect property to include top destinations worldwide, since hands-on management is not required. Many turnkey vacation home rental properties are also approved to buy with your IRA account, which means the rental income is tax deferred and provides access to funds that most investors don’t realize are available for this type of purchase.
Do you have any questions about real estate investing? Share them in the comments!
Read 7 Reasons Real Estate Investing is Better Than the Stock Market and learn more about why this proven alternative investment strategy should be an essential part of your financial portfolio.