A real estate professional can help give you an idea of what s happening in the market so you can make an informed decision when choosing an income property. The tax benefits of real estate come about as a result of depreciation or cost recovery. Depreciation is a legally deductible expense that does not cost the property owner one cent and yet it can provide an actual tax loss to offset other income. Real estate is depreciated as if it were falling in value when in fact it appreciates. There are a lot of different ways to invest your money to produce income.
Income is just one of the returns to expect from a good investment.
The money you earn can be used to improve or maintain your living standards or you can reinvest it. Rental income from real estate produces cash flow for the investor. The money left after expenses can be a positive cash flow. As rent increases this cash flow can get larger and larger, year after year. Leverage Leverage, more than any other benefit, is responsible for creating the greatest amount of wealth for real estate investors.