Building Your Wealth Through Real Estate
Most of us are taught early in our about the importance of saving money. Parents often encourage children to save some of their pocket money or birthday cash gifts. Saving money is one thing; investing money to build your wealth is another.
Optimising your wealth takes more than leaving cash dormant in a savings account and waiting for it to accrue. To increase the rate of return on your money, you need to invest your money where the return is higher than a high street bank’s interest rates.
Property investment is one of the most lucrative ways to develop wealth. Unlike buying a home, a real estate investment property is purchased to make a profit. Although housing prices can fluctuate, the general trend for property investment over time is up. And if you’re thinking of investing in a property, the best time to acquire is now. According to Bloomberg, Australia’s property market is rising again after a two-year decline. A lot of investors are currently buying properties because in anticipation of the prices going even higher in the next six to 12 months.
While a property investment offers excellent opportunities, expensive mistakes are still possible. If you don’t do your research, you will miss out on the best real estate property for sale.
Here are three ways a real estate investment can help you grow your wealth.
Consistent cash flow
Having a property investment will give you a positive cash flow if you choose to rent out the property. Naturally, a property has expenses such as a mortgage, insurance, and taxes. As long as the rent you collect is bigger than your expenses, the cash flow remains positive. Having a positive cash flow gives you a passive monthly income to save or re-invest in another venture.
Rise of home prices
Due to increased migration to Australia, house prices increase, improving the value of your asset. Appreciation of house prices is the main ingredient of building wealth through real estate. The value of properties naturally increases over time. If you buy a property now, the norm is for the value to appreciate after a few years. So whether you rent out or decide to sell, you still receive a return on your investment.
Forced equity
Forced equity refers to the profit generated from improvements that investors make to add value to their property. Adding features or modernising house utilities can improve your profits. While enhancing your property may restrict profits in the short term, the expenses will add value and increase the rental and resale price.
There is no shortcut to wealth. But property investment offers opportunities for renting or selling for a profit and provides a quicker way to wealth development.
Grow your wealth with Maidment’s premium real estate
With over 40 years of experience, Maidment has designed and sold homes to suit the North Queensland way of life. We provide investment homes by builders in Townsville at cost-efficient prices. Get in touch with us today and secure your future now with our quality investment homes.
