David's 5 benefits of owning real estate
Updated: Jul 25, 2022
Have you been looking for a better reason to invest in real estate? In this blog article we share David's 5 Benefits of Owning Real Estate.
Just last week Australia's leading real estate research platform, CoreLogic, announced that the median property price increase in Australia reached 22.2%. This means that the average Australian home is worth $126,700 more than it was in November last year!
This is exciting news for homeowners who're looking to investigate the instant equity accumulated in their property from the rising property market. What we're finding, here at REIF, is that property owners are tapping into that equity to help fund the purchase of investment properties to build wealth for their financial future. Furthermore, setting themselves up for life post-retirement.
In light of these price influxes, our Founder and CEO, David Chehade shared his '5 Benefits of Owning Real Estate,' in a five-part video series. If you haven't yet seen this series, we will share an overview in this blog.
The 5 Benefits of Owning Real Estate are as followed...
The ability to leverage
When you're a homeowner, you're provided with an advantage. That is your ability to leverage so that you can buy more real estate.
Essentially, leveraging is a financial strategy that allows you to borrow money from an existing property to purchase further investments. Lenders allow you to borrow these funds as it provides you with the potential to make greater returns.
As we've mentioned in previous blog posts, investing in real estate is probably the securest asset to invest in. That's because property is more likely to appreciate than depreciate over time. In his video series, David mentioned that historically in Australia, real estate has doubled in price every seven to ten years.
When you buy real estate to invest, a major benefit is that you're provided with tax incentives. David explains that "this works when you negatively gear a property and then offset that against the income."
Depending on the income produced from your investment property and the cash flow, you can make anywhere between $3,000 to $10,000 in cash incentives from each investment property every financial year.
The tax benefits that you can claim include paper losses from your property, depreciation, property management fees, plus so much more!
Produces cash flow
As an investor you receive rent, in the form of cashflow, and with that you produce a passive income. REIF are helping investors source property that provides them with $50 to $300 in cash-flow (after expenses) from their properties every week.
We refer to this as passive income, an additional income source that you can make as you sleep. It also means that you don't need to do anything to earn it.
The next benefit of owning real estate is that it offers an inflation hedge. Now, you may be seeing in the media that inflation is increasing in Australia. A basic principle of inflation is that when prices go up, so do rental prices and property values.
Owning real estate allows you to keep up and exceed inflation to see greater returns on your investment for the future.
Are you looking to invest?
Is investing in real estate on your radar for 2022? If you're already a homeowner, there's no better time than now to take advantage of the potential equity hidden in your home. If you're looking for guidance on how to access that to build a portfolio that allows you to generate a passive income, REIF are here to help.
Click below or reach out on the details provided to lock in your free 60-min wealth consultation and set yourself up for your financial future.
Ph: 1300 130 932