Don’t you just want to earn lots of money while you sleep? Passive income can do that for you! It can be an additional source of money on top of your regular payday, and also a valuable lifeline for when things get rough (i.e., during a recession or bad business days).
Passive income can also go directly to your retirement fund, too. There’s definitely nothing quite like the financial security that passive income can give you. But what’s a good way to get there?
Investing in real estate is one of the best ways to establish a source of passive income, especially when it’s in commercial real estate. This means putting money in apartment buildings, office buildings, industrial property, medical centers, hotels, malls, and warehouses, among others. Residential real estate can generate a decent income, but for a better payday, commercial is the way to go.
Unlike stocks and bonds, which are other types of passive income, real estate is tangible and has more benefits associated with it.
Here are some of the benefits that you get from investing in commercial real estate
Tax advantages
Investors of commercial real estate enjoy a fair amount of tax advantages. The interest payments you make on your mortgage are deductible, which allows you to use someone else’s money to purchase larger properties. You also get write-offs for maintenance, upgrades, renovations, and other expenses related to owning the property.
Buying power
When the profits from owning a property is greater than the payable interest, you can set aside a small percentage of the purchase price and invest in more properties. There’s also the option to pool your money with other investors to purchase a larger asset that might have been possible with a single investor.
Less competition
Compared to residential real estate, commercial real estate generally has less competition. This is due to the steep cost of entry, which can be too much for the average investor. Less competition means better chances of acquiring more commercial properties at a lower price.
Tangible assets
As mentioned above, real estate is tangible. This means that unlike stocks and bonds, the commercial structure and the land it’s on have value of their own, in addition to the value of the income they generate. Commercial real estate provides a safety net when other investments fail. It’s also relatively stable, and is unlikely to fluctuate in value the same way stocks and bonds do. This is because tenants of commercial properties tend to stick around longer in order to operate their businesses.
The road to generating passive income is a long one, but it’s definitely worth it once you see your wealth grow. To help you with your goals, consult with seasoned professionals.
Searching for passive income opportunities in St. Louis, MO?
When it comes to spotting commercial real estate opportunities in St. Louis, Missouri, there’s no better team to help you than the Cardinal Realty Group. We have been in the business for 35 years, helping investors realize their commercial property goals through our extensive network and a team of well-connected and respected Realtors.
Call 636.225.0385 or send an email to Hal(at)CardinalRealtyGroup(dotted)com to get started.
