Real Estate Investing in Calgary

Did you know that housing is typically a Canadian’s largest expense? When it comes to real estate investing, one thing is true: everyone needs a place to live. This makes real estate a great investment that can help you pay off debts, increase your monthly income and even save for retirement!

We often see advertisements on television and Facebook offering a crash course in real estate investing, guaranteed to make you rich. While this seems great, it is often too good to be true, and the tactics they teach can be high-risk and not suited for the average investor. The great news, however, is that you don’t need these “classes” to be a profitable real estate investor. Here are some benefits of investing in Calgary real estate:

Real estate costs rise with inflation.

Inflation is the rate at which products and services rise over time. This, unfortunately, is bad news for your bank account, and savings as the value of your money does not inflate as well. When investing in real estate, the value of your home will increase with inflation, and the cost of housing will also increase for rental properties. The mortgage on an investment property will, of course, remain the same as well.

Real estate investments provide tax advantages.

When investing in real estate in Calgary, many people overlook the fact that you can receive tax benefits. Recording your investment property income on your tax return allows you to deduct expenses associated with your investment. These deductions include rental expenses such as taxes, insurance, maintenance costs, interest, management fees and even advertising!

For those interested in living in the investment home during renovations, a principal residence is exempt from paying capital gains taxes when the home is sold.

Real estate often provides good return-on-investment.

When purchasing an investment property, most people use a loan to cover a portion of the cost. Despite the value of the home increasing as you pay off the investment, the amount of your loan will always remain the same (with interest of course). Any increases to the property value of your real estate investment are completely yours once you own the home.

Investment properties can increase your cash flow.

Whether you plan on purchasing an investment property to sell or rent after renovations, the investment can provide you with cash flow. When renting, the investment property can provide a stable monthly income. Those that choose to sell after renovations will obviously receive a lump sum, great for a new investment or saving for retirement.