Buying Real Estate As An Investment May 2026

Between depreciation (a "paper loss" that offsets your taxable income) and 1031 exchanges (which allow you to defer capital gains taxes when selling one property to buy another), the tax code is heavily weighted in favor of property owners. The Real-World Risks

Real estate is one of the few investments where a bank will let you buy an asset worth $500,000 with only $100,000 of your own money. This leverage means that if the property value goes up by 5%, you haven't just made 5% on your cash—you've made a much higher return on your actual down payment. buying real estate as an investment

Buying shares of companies that own real estate. This is the most "passive" route, offering exposure without the need to fix a leaky faucet. Between depreciation (a "paper loss" that offsets your