When looking for the right property to purchase, DO NOT expect to find the perfect investment property within the first few days. Hours of sorting through properties will be required to find the best property to maximise returns. DO NOT expect to find the perfect property around the corner from you, or in the neighbourhood next door. You need to be flexible and look abroad, even interstate or overseas. When looking for an investment property you need to focus on return on investment. In other-words, how much money will I make on what I have put in. For instance when I invest in property, I will measure the return as a percentage, if I put $10,000 down as a deposit, and make $10,000 on that in the first year that’s a 100% return; not a bad result. How do you achieve these results and replicate them many times to create wealth? Read on to learn.
Mudah Property
Leverage is a wonderful tool for the investor. It allows us to place a small deposit on a property and reap the entire capital gains. For instance if I place a $20,000 deposit on a $200,000 house, and the house goes up 10% in the first year that’s 100% profit. On average property has gone up 10% per annum so you would effectively make 100% every year on the property. Any rental income would be used to service the $180,000 debt. Now if you did this across 10 properties outlaying $200,000 you would be making 100% per annum. In comparison, if you outlaid the whole $200,000 on one property you would make only 10% profit per annum as the one property would only go up 10%. Sure you would make some rental income as well but this would be relatively insignificant. More on Mudah.