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Rental Property Investing Versus the Stock Market

Many resist Raleigh rental property investing because they think that it will end up consuming a considerable amount of time, which will lead to fewer net returns than stock investing. But, many investors continue to invest in rental properties. But why? There are four key benefits to Raleigh rental property investing, whereas stocks only provide some of those benefits.


Income is a notable advantage that real estate investments have versus stock investments. Income is defined as the profit after paying any other debts and expenses. Rental properties give income or “cash flow” each month, while many stocks do not provide monthly income.


Raleigh rental property investing uses leverage, or a loan, to purchase the property. If you own a home, then this will be familiar ground, yet with a rental investment property, the mortgage payment comes from your resident’s monthly rental payments instead of from your own pocket. When you view it this way, then it seems like a good deal because when was the last time someone offered to buy stock investments for you?

Tax Benefits

Perhaps the greatest benefit of real estate investing is that you receive tax benefits, too. Owning a rental property is one of the most powerful tax benefits that you can get. Depreciation gives you the opportunity to claim a loss even if you are seeing a profit. This benefit will fade gradually over the years, but there is another option to help you with your taxes. With a 1031 exchange, when you want to sell the property, you can then purchase a different one without paying any capital gains tax. You can then repeat the process. However, we do not suggest that you do this on your own, but instead with the right guidance and accountant.


Appreciation occurs when an asset becomes more valuable than what an investor had originally paid for it, and this is the key reason people invest in the stock market. Real estate can appreciate, too. You need to keep an eye on the economy, but wise investors can gain from this buy and sell method.

Does real estate require more work than stocks?

If you do property management on your own, then real estate investing can be difficult and require a significant amount of work. You need to do all the maintenance tasks and answer every tenant phone call. However, you do not need to do property management on your own. Instead, you can hire a professional property manager to do those tasks on your behalf. This will not only save you time but can also help increase your returns. This results because a property management company endeavors to reduce vacancy time, resolve problems promptly, keep your renters pleased, and seek to obtain the best maintenance costs for you.

Would you like to learn more about our Raleigh property management services? Please contact us for more information.


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