Financial Freedom
Investing In Real Estate May Be The Answer
By Esther Reizes-Lowenbien
What does financial freedom mean to you? The most common response I received from asking some of my clients is having the stability, flexibility, and ability to do what you want with your finances on your own schedule. Several stated that it means to be debt-free, paying off tuition, or having enough money for a rainy day. Most said that achieving financial freedom would allow them to spend less time working and more time on their hobbies, meaningful causes, and family.
That begs the question—how does one achieve financial freedom? I interviewed several financial planners and wealth managers to hear what advice they offer their clients to achieve financial freedom. Every client is advised to speak to a financial advisor to determine what strategy to take. Whether one is planning for retirement, earning residual/passive income, or saving up for anything, one needs an investment strategy that fits their budget and needs.
While many recommended stocks and options, real estate investments were offered as a safer, more tangible option. Real estate is more stable and less volatile than the stock market. It provides diversification; one can be invested in several properties at once. Real estate investors can leverage their money, take control over income by managing properties, and reap the advantages of tax benefits.
A good example is Ariel Serber, who offers financial peace of mind to his clients, recommends real estate as the value can appreciate, obviously in the right circumstances. Yaakov Berman, Financial Services Professional, cautions investors to do proper due diligence on any investment they are going into, have a good safety net, and use excess money only.
Adam Doran, an advisor at Prevail Innovative Wealth Strategies, believes that owning real estate is the key component of wealth-building. It is the only asset that one can purchase at a discount, take regular tax deductions on, enjoy passive income from (offset by tax deductions), enjoy appreciation from, sell at a profit, and roll the tax deferments into the next purchase. Adam explains that the key to real estate is creating a truly passive income by leveraging a team’s skills. Many people set themselves up for failure with real estate by trying to do everything themselves. Unless one is an expert, they should lean on the power of a team of specialists to trust and manage the details. The investor’s job should include performing due diligence, analyzing numbers, and producing the capital to purchase the investment.
As a Licensed Real Estate Salesperson and a serial networker, I work carefully to search for the right investment based on each client’s criteria. I work diligently to assist clients and present deals in various asset classes, ranging from multifamily, office space, industrial, hospitality to retail properties. Through my real estate networking abilities and attention to detail, I make meaningful and effective connections between investors and the appropriate properties.
Investing in real estate is a supercharged way to grow and multiply your wealth! Yet, there are some things to consider when it comes to real estate and its risks. Investing requires a lot of research. Profits and results may take time. Remember, real estate is not easily liquidated; if one is in a bind, they cannot immediately take out cash.
There are several forms of funding a commercial real estate investment. It is helpful to start exploring different options early on in one’s search for an investment property. There are three basic types of loans: traditional, government-backed Small Business Administration (SBA), and private. It is important to note the duration of the loan, the interest rate, the ability to qualify, and the time it will take to obtain the loan.
A Senior Mortgage Broker at Meridian Capital Group notes the importance of consulting with a mortgage broker to obtain the best financing for one’s investment. He says this rings true now more than ever, with the COVID-19 pandemic. During these unprecedented times, lenders are constantly changing commercial class assets they are funding. A large company, such as Meridian Capital Group that finances over 40 billion dollars a year, stays up to date on a minute-to-minute basis and is aware of changes as they happen. They can often foresee what change will take place, via speaking to the lenders and speaking to people on the board. A mortgage broker with close insight into the market can save the investor a lot of money and time, often being a deal-maker or deal-breaker
Brian Briscoe, host of Diary of an Apartment Investor podcast, relates his reason for embarking on his investment journey to be financially free. He began by investing in single-family homes in 2007 and switched to apartments in 2018. Together with his partners at Four Oaks Capital, they have purchased 168 units, with 249 more under contract. This passive income will enable him to spend more time with his family during the holidays, birthdays, anniversaries, and summer vacations. He notes, “Real estate investing allows me to control my time, be where I want to be, and have the resources to help others.”
Esther Reizes-Lowenbein is a Licensed Real Estate Salesperson at eXp Realty. For more information, contact her at estyreizes@gmail.com.
