Real Estate is A Better Investment Option for Senior Citizens
Aug 02, 2017 Home Trading Steps
Real estate is a tricky field of investment. The returns can be either consistent, slow or there may not be any fruitful return for a while. That is why should a senior citizen who have retired and have ample money in hands think of investing in real estate?
Mostly, real estate is not the choice of the retired personals. They prefer investing in stocks, markets, and bonds. Why do they hesitate from investing in the real estate?
They find it easier to invest in stocks and bonds.
They fear that they might lose their money if they invest in real estate. There are many ups and down there.
Not only senior citizens, even the younger generation find all the paperwork involved in buying and selling of the real estate property cumbersome.
Even if they rent out the property, they have to look after it themselves and maintain it.
But as always there is a brighter side of investing in real estate:
You can rent the property and get fixed monthly rental in future.
You can pass it on to your next generation who might be profited from it.
In long term, the property might fetch a good amount of money when sold.
How can a senior citizen invest in real estate?
Rent out the property for the residential use. This will make sure that you get fixed monthly income. You can hire an agent who can help you to find a good tenant, help them in addressing their grievances. You can pass it to your next generation as well.
If you don’t want to invest in the residential market then you can rent it to the commercial market. There will be a long term lease while you earn fixed income every month from it.
A safer way and indirect way of investing in real estate are the Real Estate Investment Trust (REITs). SEBI has set out the norms for REIT and they will have to share 90 percent of the profit with their investors. The minimum amount required for investment in REIT is Rs 2 lakhs.
You can also collaborate with a bunch of investors and take a stake in the property and earn the profits accordingly. This way you will not earn profit from only one property but invest in various ones and receive the profits from them.
How much can be invested?
You don’t have to put all your retirement money in the real estate. According to experts, you should only put 10 percent of your money in the real estate. The investment in real estate can help you earn 5-10 percent profit annually.
If you have an appetite for risky investment, direct investment in real estate is a better option.
Mostly, real estate is not the choice of the retired personals. They prefer investing in stocks, markets, and bonds. Why do they hesitate from investing in the real estate?
They find it easier to invest in stocks and bonds.
They fear that they might lose their money if they invest in real estate. There are many ups and down there.
Not only senior citizens, even the younger generation find all the paperwork involved in buying and selling of the real estate property cumbersome.
Even if they rent out the property, they have to look after it themselves and maintain it.
But as always there is a brighter side of investing in real estate:
You can rent the property and get fixed monthly rental in future.
You can pass it on to your next generation who might be profited from it.
In long term, the property might fetch a good amount of money when sold.
How can a senior citizen invest in real estate?
Rent out the property for the residential use. This will make sure that you get fixed monthly income. You can hire an agent who can help you to find a good tenant, help them in addressing their grievances. You can pass it to your next generation as well.
If you don’t want to invest in the residential market then you can rent it to the commercial market. There will be a long term lease while you earn fixed income every month from it.
A safer way and indirect way of investing in real estate are the Real Estate Investment Trust (REITs). SEBI has set out the norms for REIT and they will have to share 90 percent of the profit with their investors. The minimum amount required for investment in REIT is Rs 2 lakhs.
You can also collaborate with a bunch of investors and take a stake in the property and earn the profits accordingly. This way you will not earn profit from only one property but invest in various ones and receive the profits from them.
How much can be invested?
You don’t have to put all your retirement money in the real estate. According to experts, you should only put 10 percent of your money in the real estate. The investment in real estate can help you earn 5-10 percent profit annually.
If you have an appetite for risky investment, direct investment in real estate is a better option.
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