Investing in property can be a very lucrative venture. Not only can it help you build wealth, but it contributes to a more diverse portfolio, too. But even though property investment comes with many, many perks, it can come with just as many, if not more, challenges.

Before you take a deep dive into the world of real estate, it’s important to be sure that property investment aligns with your financial goals, risk tolerance, and lifestyle.

To ensure you’re making the right decision, here are five signs that indicate property investment may be the right move for you.

1. You are financially stable.

Investing in property without secure income or sizeable savings is sure to be a big headache. And while there are property types that fit multiple budgets, there are plenty of other costs that quickly add up.

For example, property investment typically requires a significant upfront investment, which includes a down payment, closing costs, and ongoing expenses like mortgage payments, property taxes, insurance, and maintenance costs.

Beyond having a decent source of income, you also have to have good credit score, plus enough savings to cover any unexpected expenses.

2. You have long-term financial goals.

For most people, property investment isn’t a get-rich-quick scheme. It takes a lot of time and patience before you start seeing results.

So if you have long-term financial goals — i.e. saving for retirement or building a college fund for your children — property investment may very well be the right choice for you.

3. You want to diversify and grow your portfolio.

When it comes to investment portfolios, it’s always a good idea to mix things up. And fortunately, one of the biggest perks to investing in real estate is that it helps to diversify your portfolio beyond stocks, bonds, and mutual funds.

If you have other investments, putting some of your money into real estate can cause your portfolio to be more varied. This helps to spread out the risk, so if one of your investments isn’t doing well, you still have a chance with the others.

Having different types of investments can not only help your overall investment plan do better, but it can help you earn more money down the line, too.

4. You have an interest in real estate or market knowledge.

Are you fascinated with learning the ins and outs of real estate? Perhaps you took a course or even graduated with a degree in it at some point?

If you have a genuine interest in the world of real estate, trying your hand at investment might be enjoyable for you. People who enjoy researching property trends, analyzing market data, and exploring potential investment opportunities are likely to thrive in the world of property investment.

So if that’s you, don’t be afraid to dip your toe in the real estate investment pool. Your passion and understanding of the industry just might prove to be a valuable asset for you in the long run.

5. You desire passive income.

The great thing about property investment is that you can generate passive income by renting out to tenants. Whether you need the money to supplement your income or you simply want to build more wealth, rental income can certainly help you meet your goals.

By buying hot properties, you can use your rental income to cover mortgage expenses, build equity, and achieve financial independence.

6. You have patience.

As previously mentioned, it can take months or even years to see the fruits of your investment labor. This can be due to things like market fluctuations, economic cycles, and other factors that are totally outside your control.

Because of this, investing in real estate requires a lot of patience. If you can withstand the many ups and downs of the real estate world, you may be rewarded with strong returns in the long run.