We’re deep diving into why you should give serious thought to property investing in 2021. Whether you have recently graduated from college or are getting close to retirement, it’s likely that you have given some thought as to how you can grow your net worth.
You might have invested in stocks, picked up a few bonds or have a pension plan set up to help fund your retirement. But have you considered buying real estate as part of your portfolio?
In today’s blog post we’ll have a look at three reasons why property investing is one of the most effective ways to grow your overall net worth.
Reason #1 It Generates Passive Income
One of the best reasons to hold property as part of your investment portfolio is that it can generate passive income. Whether you buy a single-family home or an apartment block, you can almost certainly find interested tenants who will live there.
Part of the rent you receive each month can cover the costs of owning and operating the property. The rest of it is income which will continue to build over time. After how fast we’ve seen the global economy shut down, it’s a no-brainer to start investing in other avenues of income. Investing for income is one of the secrets to building a massive pension.
Reason #2: Property Increases In Value Over Time
Another great reason to invest in property is that in most cases, it increases in value over time. As long as you are maintaining the property and investing in its upkeep you have a decent shot at it being worth more in the coming years, should you decide to sell.
Keep in mind that property is cyclical and that it’s not always going to be the right time to sell and realize your gains. Planning for the future is exactly why it’s the best time to start getting into property.
Reason #3: You Can Leverage Equity To Do More Property Investing
Finally, our third reason that property is the best way to build your worth is your ability to use it as leverage to buy more property. For example, say you decide to purchase a house valued at £100,000 as an investment.
Once the mortgage on that home is paid off, you have an asset valued at £100,000 that you can then borrow against. So you can go out and acquire another £100,000 home without having to sell the first. As you can see, this can scale quite nicely over time. They say the best time to plant a tree was yesterday but the second best time is today. It is the same with property investing.
If you are interested in learning more about property investing and how you can make use of mortgage financing to purchase properties, give our offices a call. We are happy to share our insight and expertise as well as advise you on what we think is the best option in the current market.