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Afford Anything · November 4, 2024 · 50m

7 Real Estate Investing Myths That Cost You Money

Pant debunks common real estate investing myths from her own experience as a landlord. Why 'real estate always goes up' is dangerous, when renting beats buying, and the hidden costs nobody talks about.

Highlights

The myth that real estate always appreciates ignores that houses are depreciating assets on appreciating land
Pant: a house is a physical structure that deteriorates over time. Only the land appreciates. When people say 'real estate always goes up,' they're confusing the land value gain with the building's maintenance costs.
Leverage amplifies both gains and losses — real estate's greatest advantage is also its greatest risk
Pant: real estate's outsized returns come from leverage (buying with 20% down, borrowing 80%). But leverage works identically in both directions — a 20% price decline wipes out 100% of your equity.