Investing in property has long been the preferred way to create wealth with average Australians and with very good reason. Over the years and fluctuating markets – property investment has delivered solid returns and enabled millions of everyday people to create real wealth.
Investing in property is not as complicated or risky as other financial products like stocks, shares or
bonds. Property has been generally considered a solid and reliable asset.
The investment principles involved in property are also pretty simple and, with realistic objectives, the right approach and plenty of research, you can vastly minimise your risks and in fact achieve attractive returns over the long term.
So how can a well-researched property investment deliver a good return? One of the greatest attractions of property investment is the ability to leverage. Leverage means the potential to borrow money to expand your buying capacity and maximise your returns.
No one can guarantee that your property will go up in value every year but historically on average Australian property has doubled in value every 8 to 12 years. So imagine the financial gain if an investment property was held for 20,30 or 40 years.
Renting out your investment means that your tenants help you pay off your mortgage. There may be a shortfall between your mortgage repayments and your rental income, however, if the rent increases over time, and your mortgage payments decrease this shortfall will lesson and may eventually become a positive income. Rental values have also increased historically so it is possible that your investment property will deliver increasing income over the years.
If your rental income is higher than the mortgage repayments, the additional cash can be directed back onto the loan to help pay off the principal sum. While this can take time, the result will be an income-generating asset. Of course, there may be times when the property sits vacant – you should always tray and have funds set aside to cover this time.
There are so many reasons and ways to invest in property and we could fill up an entire website with ways to achieve this. But each person and their situation requires a different strategy and that as why you should come and talk to us!
Let us help you ride the wave to wealth through investment property!