Property Intelligence
Investing in real estate is the classic way to build wealth. By investing in real estate, you are buying something tangible, not just a document that says you own something. In the long term, investing in real estate has consistently shown growth in value, even when other investments experienced periods of questionable stability. Real estate investing also offers some substantial tax benefits not found in other investments.
Real estate Investing allows the average investor to maximize his or her investing power through leverage. Using leverage, an average real estate investor can buy properties in excess of 200K or 300K for only 5%-10% of the total cost of the property.
In the world of property investing there are two applicable strategies to be aware of - either capital appreciation and/or positive income returns.
Capital appreciation is the capital growth that fuels your equity base for further leapfrogging real estate purchases. The second way you can generate cash flow in property is by securing a positive income return . Positive income returns occur when your investment income is higher than your investment expenses.
The positive cashflow concept is different to 'negative gearing' which means that you are creating an income loss so you can claim a tax deduction. This focuses on capital appreciation at the expense of any positive income return. A property investor will need to establish and clarify the desired outcome in any future purchase in light of their current financial circumstances.
In order to compete in today's real estate investing market, an investor needs to become savvy in the fields of the buy & hold , cashflow positive , rejuvenation , flip , lease-options and STAG ( short term aggregate gain ) strategies by educating themselves.
|
“People say it takes money to make money. No, it doesn’t take money to make money. It takes experience to make money and knowledge to make money .But if you lack experience and you lack knowledge, then it takes lots of money and lots of risk. The more knowledge and experience you have the less money it takes and the less risk it takes. That’s why the rich get richer." |
|
