by Theresa Bradley-Banta
 

Why invest in real estate?

 
Here’s a fun short answer…

Years ago I worked with a woman investor. She would walk into a property she was thinking about buying and gleefully say, “Hmmm. It smells like cat pee!”

What she was referring to was the acronym “CATP” as in,

  • Cash flow
  • Appreciation
  • Taxes (benefits)
  • Principal paydown (building equity by paying down a mortgage)

Imagine the surprised looks she received from sellers and seller’s agents!

A shocking thing to say? Perhaps. Memorable? Definitely!

CATP

 
When my friend made her “cat pee” comment she was also noting that a property wasn’t necessarily beyond hope. She knew she could fix it up and make a profit.

And that’s one of the great things about investing in real estate. It’s a tangible asset.

Real estate historically has been a safe, sound, solid investment. It tends to go up in value, provides cash flow from rental income and offers tax benefits and incentives.

Over time equity value increases as your loan is paid down.

And with some real estate investments you can force appreciation by making improvements to the property—improvements to management and operations and through upgrades and renovation.

In a nutshell, CATP is what real estate investing is all about. And what a simple way to remember the benefits.

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Theresa Bradley-Banta writes about investing in real estate while avoiding the pitfalls that plague many new investors. She is a 2017 PropTech Top 100 Influencer and winner of 14 American and International real estate awards for her website and real estate investing programs. As featured on: The Equifax Finance Blog, AOL’s Daily Finance, Scotsman Guide, The Best Real Estate Investing Advice Ever Show, Stevie Awards Blog, Rental Housing Journal, and Investors Beat among others.

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