5 Reasons to Build a Real Estate Property Portfolio
I think you'll agree with me that real estate investment
deserves a closer look when I tell you that according to many
sources 90% of the world's richest people made their fortunes
from property!
So here are just five quick reasons why I think you should
consider building yourself a real estate portfolio.
1) Freedom - By working to create a profitable business from
your underlying property assets you can free yourself from the
shackles of 9 - 5 employment where your creativity is zapped and
your potential overlooked!
In this day and age those who can say that they love their job
are the much envied few. For the rest of us the daily grind is
simply necessary to keep a roof over our heads, feed and clothe
our children and hopefully be able to afford to retire some day.
Does that sound like freedom to you?
I don't think so!
The creation of a profitable property portfolio will allow you
the freedom to make your own business decisions, to work when
you wish and to manage your family's finances more effectively.
2) Leverage - if you place a twenty thousand dollar lump sum
into a bank you will earn interest on that figure alone - the
interest rate will likely be poor and taxation and inflation
will eat away at any gains you make.
Alternatively, by placing twenty thousand dollars into a
property worth one hundred thousand dollars and using a bank's
money in the form of a mortgage to leverage up, you make will
make the average annual increase on the full value of the
property not just on your twenty thousand dollar investment!
3) Profit Twice - with property you can profit once in the form
of regular rental income earned and you can profit twice and big
time from the average price gains your property will enjoy each
year.
Even during a real estate market down turn when prices stagnate
or readjust your property will hold at least the majority of its
value before once again attracting positive capital growth when
the property market cycle begins to turn to profit again.
4) Consistent Growth - over the last fifty years real estate has
doubled in value every seven years. If you average that out that
means that property has grown consistently by just over ten
percent a year.
5) Passive Income - As your property portfolio grows so the
amount of income you generate will increase. You will not be
able to stop this growth once it starts because each year your
properties will go up in value and regularly you'll be able to
push up rental income!
While you retain ownership of your properties so you will retain
ownership of all the income and all of the growth in underlying
value - this is a passive income that you can take into
retirement and hand on to your children and grandchildren when
you're gone.
A Final Word - Making an investment into real estate is just
like making any other form of investment. There are associated
risks and past performance is not an indicator of future
potential. Furthermore this article does not constitute personal
direct advice.