# A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
Real Estate

Most people's homes are indeed their largest investments. We all have to live somewhere, and a happy side effect is that real estate tends to appreciate in value over time. But if you are going to use real estate as a true investment vehicle by buying a second home, a piece of land, or a rental property, it's important to keep the following in mind.

First, despite exceptionally strong performance runs, real estate can and does occasionally decline in value. Second, real estate taxes will constantly eat into returns. Third, real estate owners must worry about physically maintaining their properties or must pay someone else to do it. Likewise, they often must deal with tenants and collect rents. Finally, real estate is rather illiquid and takes time to sell—a potential problem if you need your money back quickly.

Some people do nothing but invest their savings in real estate and do quite well. But just as stock investing requires effort, so does real estate investing.

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