Residential Investment Property - Is it Really Worth the Effort?

This article is the beginning of a series of articles focussing on investing in residential real estate.

The title of this article poses a very good question. My definitive response is YES. There are so many valid reasons you should consider residential real estate as a vehicle for building wealth, some of which are described below:

Reason 1: Generally speaking property is a stable investment. It does not experience the volatility that for example, the share market does. In fact, well researched residential property very rarely drops in value . . . it may plateau BUT normally does not drop in value.

Reason 2: Everyone is involved in the property market. In one way or another, each and every one of us is involved in residential property - either as a property owner OR tenant. This creates significant demand.

Reason 3: Banks and other financial institutions are happy to lend money using property as security. From the point of view of a bank, there is nothing like bricks and mortar as security for lending.

Reason 4 Tax benefits help pay expenses. In affect, this assists with buying an investment property. Such benefits include tax deductions for relevant expenses such as rates, interest, repairs, property management, and depreciation.

Reason 5: You can add value and achieve immediate capital gain. There are many ways to add value to property. One of my favourites is to focus on cosmetic changes. In other words, concentrate on minor expenditure items such as a new coat of paint, new door handles, new cupboard doors in the kitchen, new light fittings, etc.

Reason 6: Rental income will eventually more than cover associated expenses. I recommend holding property for the long-term. In my experience, and this depends on the circumstances of each individual property, it takes approximately 4 to 5 years for a negatively geared property to become positively geared. Once that happens, not only is the property not costing you anything, it is actually putting cash in your pocket.

Reason 7: Property ownership is relatively familiar to most folks. This makes the purchase of residential property a much easier option to get right.

Reason 8: Generally on average, real estate doubles in value every 7 to 10 years. This becomes an enforced method of saving AND when the rent increases sufficiently, it can put money in your pocket.

Reason 9: You do not need to earn a fortune to invest in residential real estate. Many property investors earn less than $40,000 per year. It is not necessarily how much you earn that counts, rather it is what you do with what you earn.

These 9 reasons only scratch the surface. In my opinion there are literally hundreds of reasons to consider residential real estate as your primary investment tool. Let's face it, unless history changes, well chosen property will result in increased wealth.

We could keep going, however hopefully I have convinced you to at the very least, consider residential real estate as a serious option as your wealth building vehicle.

A mistake when purchasing residential property can be both expensive and long-term. If you are not an experienced property investor I strongly suggest you either gain sufficient knowledge through self-education OR short-cut the process and hire professional Buyers Agents. To find out more >>>>> CLICK HERE!!!

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