Some Powerful Ways Real Estate Can Make You a Millionaire

As per the experts of Dream Homes, investing in real estate is the best mode of generating great returns in the current scenario. Although, just because you purchased a piece of property doesn't mean you're going to make riches. As Dream Homes Developers state, big wealth is generated through realty investment by capitalizing on "the four wealth generators of real estate." Single-handedly, each of these can help you make more money, but jointly they'll make you wealthy.

 1. Cash flow

Cash flow is the additional profit available after all of the fixed expenses have been paid on a property. For example, if your rental property generates INR. 50,000 in income and your expenses came to INR. 40,000, your total cash flow would be INR. 10,000 per month. Obviously, "ten thousand Rupees is not going to make you a millionaire." But remember, it is just one of the money generators. There are still three more to go!

2. Appreciation

Here, the term appreciation refers to the opportune rise in value of real estate. For instance, if you purchased a property for 20 lakh a decade ago, and today that property is worth 60 lakh, the appreciation made you 40 lakh richer! Of course, appreciation doesn't lead to increase in values every year. However, traditionally, real estate prices have remarkably increased over the long term. Hence, appreciation single-handedly is not going to make you a millionaire, so it is recommended not to indulge in bad deals in hope of appreciation.

3. The loan pay-down

When you buy a leasing property with a mortgage, you have to make a payment to the lender on monthly basis. That payment incorporates two parts: principal and interest. Interest is the revenue for the lender, but the principal is amount that you are paying down the loan with.For example, if you purchased a property five years back for $100,000 and acquired $80,000 mortgage (we’ll consider it was a 30-year mortgage with a 5 percent fixed rate), at present you would owe only $74,000. Ten years down the line, you would owe only $65,000. This indicates that each year your equity increased, as long as the value of your property didn't fall.

4. Tax benefits

Lastly, tax benefits provided by the government to investors are the fourth wealth generators in real estate investment. But you should definitely confer with a professional CA before making any financial or tax decisions.

Here are some Top Myths about Real Estate!

Everything you read on the internet is not necessarily true. Real estate myths are too common, some of them might be true while other are absolutely bogus. Whether you are a purchaser or a seller, the real estate world can be a mystifying place to navigate. In order to separate facts from fictions, Dream Homes presents some common myths you need to debunk. With this you can make the smartest choices, rather than just believe what you hear.

Myth #1: Agents quote higher sale price for receiving higher commission

Real estate agents are sincere professionals who want you to get a dream home at the accurate price. Your real estate agent will help you to work on different offers on a home to settle on the best offer amount. For instance, in a variegated offer situation, you might make a higher offer so that you have a good chance of cracking the deal.

Myth #2: Listing home at a lower commission will help you earn profits

Generally, we hire a Real Estate agent for his experience, negotiating abilities, and his verified track record. Best agents do not rebate their services because they don’t need to. None of the realtors will market your home properly if you discount their services. So in order to crack the best available deal, you need to keep your agent satisfied.

Myth #3: Realtors get bribes from dealers, inspectors, etc.

Not only is this deceptive and immoral, but as said by RESPA (The Real Estate Settlement Procedures Act) it is unlawful. No professional Realtor will put his career and reputation at risk just to earn a bribe.  The only reason agents give you recommendations for various vendors is because they have built professional contacts with these people. This only helps to certify a flawless transaction for everyone involved.

 Myth #4: You can save money by not hiring a real estate agent

It’s true that you can get your home sold by listing it yourself and saving the listing commission. Majority of the buyers hire an agent and indirectly you will have to seek an agent’s help to find buyer. They will usually ask you to sign a One Party Listing Agreement before introducing their buyer. This means that you agree to pay them a commission. Hiring an agent means that they will help you to make the best decisions when buying or selling your home.

Old Home Vs New!

During the time of buying a home many people struggle with confusion that whether to purchase a brand new house or to purchase a house that is up for resale? A few individuals feel that buying a house or property involves a great deal of money so when they are spending such huge amount of money then why should they settle for something that is second hand. On the other hand some people feel that buying an old house is a brilliant way to cut down the huge cost involve in the while process.

Real Estate experts from Dream Homes say that though it’s better to buy new house but this decision depends entirely upon a person’s personal choice and financial position also plays a key role in it. Read on to discover two major reasons why buying a new house is a superior alternative for you:

• You’ll have to make adjustments in an old house:

This goes without saying that if you purchase a used house then you would have to make a lot of adjustments. For example if you feel that a room is a bit congested or the roof is too low then you can't do anything about it. The only alternative is to reconstruct it which would obviously require you to spend some additional cash. Then again on the other hand if you purchase a new house then you can plan the outline according to your needs and requirements.

• No Hidden Costs:

A newly constructed house the total cost covers everything. This means that you won't feel the need to shed out additional money in the denting and painting of the house. On the other hand in case of an old house you might need to spend some more money in the form of various hidden costs.