A plethora of investment options are available to people looking for places to invest their savings. One such option is beginning real estate investing. It is a highly rewarding investment option and if you do decide to get started in real estate investing you will enjoy excellent returns on your investment, much more than most other investment options.

Real estate investment has the enormous potential to give huge returns. You can borrow the money from a bank to finance your real estate investment. Most of the banks are willing to finance 90% of the cost, so you can get into a deal with a 10% down payment. This gives you a 10 times return on your investment. Let's take the example - if you have $10,000 to invest and assume you get 10% return regardless of the investment vehicle you use. If you invest in stock market to buy shares worth $10,000 then at the end of 12 months, your investment is worth $11,000. Instead, if you invest the same money into real estate with 90% bank loan, you earn 10% on the total $100,000 investment and you will endup with $110,000.

Your $10,000 has been doubled in the real estate investment but returned only $1,000 from stock market. This is because of the fact that you have used your lender's money through real estate investment. This is the best part of real estate investing as it gives you power of leverage in the investment. There are more strong and valid reasons for you to get started in real estate investing.

The tax benefit that one can avail is another good reason for becoming a real estate investor. The REQUIRED depreciation by the IRS on the property provides one of the best tax breaks by showing a "paper loss" on the property when in most cases the value of the property is appreciating. The juicier part of the story is that one pays taxes on a reported profit figure that is significantly lower than the actual earnings.

The 1031 exchange defined in section 1031 of the Internal Revenue Code of United States figures on top of the list of tax benefits available to US citizens. Under this, the people selling their property don't need to pay capital gains tax if they choose to reinvest the proceeds of that deal into another real estate investment.

One final benefit of beginning real estate investing worth mentioning here is the flexibility of sale contracts. Unlike the stock market you can get very creative with your offers. You can exchange virtually anything for a property instead of cash which can mean greater returns and some spectacular win-win arrangements.