Investors hear from any number of gurus about diversifying a portfolio. Depending upon your age you might be told to put a certain amount of your funds in aggressive mutual funds and as you get closer to retirement age you should get out ofinvesting in real estate equities and into securities or cash. But the successful real estate investor sometimes has a different idea.

There’s no reason to allocate anything based upon age of the investor but how much return an investment will bring. Investing in real estate provides advantages that equities can’t provide.

There’s a different mindset for real estate investors, primarily one that the investor can drive by every day and look at it. It’s a tangible asset that has a property address and not something that fluctuates daily based upon some obscure economic report.

Real estate investing provides consistent monthly income and is the amount of money left over from the rental payment after the mortgage, taxes and expenses are covered. Successful investors don’t invest in properties that don’t cash flow.

Real estate appreciates in value over time. Yes, we’re coming off the heels of a rather significant downturn but historically real estate consistently provides solid returns year after year. This of course isn’t guaranteed but easily researched in the area an investor is considering.

There are considerable income tax advantages that investment properties provide that other investments cannot. Besides the positive cash flow provided each month, your costs of borrowing and maintenance expenses may be tax deductible.

Yes, there are always two sides of any coin including dealing with bad tenants or properties that always need fixing, but those are situations that with a little preparation can be completely avoided. In fact, professional property managers, a good real estate agent and a general contractor on your side and help you avoid both of those negatives.

Who says you need to diversify? If you like it and you’re making money, do more of it, not less.