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 While real estate no longer holds the status of being an investment that will always appreciate, owning property is nonetheless one of the safest and stablest investments that a person can make. When investing in real estate, the investor is gaining ownership in property, which can never be stolen or destroyed, and an improvement upon that property -- a house or building -- which can be rented to tenants for profit. Ultimately, this leasing of the property can pay for the investment itself and yield further dividends beyond that cost.

Investing in either undeveloped property or real estate will always pose a risk to the investor. As recent economic events have indicated, real estate always presents a possibility of depreciation. Property values, after ballooning beyond market capacity, have declined sharply across the globe. Nonetheless, property owners who use their real estate as a means for producing income continue to benefit from this income despite the decline in the assessed value of their properties. Owners of stocks, bonds and other financial instruments have lost both assessed value and the possibility of income from these investments.

In addition to considering risk, property owners must consider the liabilities inherent to property ownership. Maintenance, upkeep and insurance are variable costs which property owners must be prepared to absorb at unexpected times. These costs must be factored into the cost of the investment when considering if owning real estate makes fiscal sense for an individual.

The first step to becoming a property owner is to assess the amount of money that will be available for monthly payments, incidental costs and a down payment. Close adherence to this budget is essential to making a real estate investment that will not result in a financial crisis if the property loses value, nor require a risky "creative" mortgage that might imperil ownership of the property with balloon payments or sudden interest increases.

Once a budget has been determined, the prospective property owner needs to embark upon a search for a property meeting the budgeted limit. In addition, the prospective owner needs to ensure that the market value of the property -- and the comparable rents in the area -- will enable him or her to make the investment worthwhile and guarantee sufficient income to cover the mortgage and incidental costs. The owner needs to further determine a budget for any renovations or improvements which will enable the property to garner a higher market rent.

Closely adhering to these steps will enable a prospective property investor to make intelligent decisions and reap the rewards of their investment.

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