People looking at buying their first investment property often express concern that investing will limit their financial freedom. Nothing could be further from the truth; property investment is a ticket to freedom. The current market presents ideal conditions for investors, and by beginning to steadily build up a portfolio, you can gain a dependable asset as well as a fantastic, flexible lifestyle.
A careful property investment strategy will, over time, start to provide you with long-term rewards and the freedom to focus on what really matters to you in life – perhaps it’s a job, taking time off to travel or raising a family. Whatever the case, you’ll be able to rest assured knowing that you’re backed by a bricks-and-mortar asset. Unlike you, your property portfolio is working 24 hours a day, seven days a week to constantly expand your wealth.
ACHIEVING CAPITAL GROWTH THROUGH PROPERTY
It took me nine years to gain financial freedom through property investment alone. I did this by focusing on buying smart and steadily building up my portfolio. Once you have one appreciating asset, you can build up equity, which can then be used to purchase your next property – without having to fund the purchase from your wages.
It is at that point that the financial benefits allow for change and freedom. For me, this meant I was able to abandon a nine-to-five job at the age of 31 and focus on my investments. I then turned what I love – property, television and education – into my “day job” as a buyer’s agent and TV host.
Well-chosen properties in key hubs in Australia generally double in value every seven to ten years and produce consistent yields. These types of returns are far better than those achieved by other asset classes such as shares, which is why I tell investors that property can offer the ultimate ticket to freedom.
PROPERTY OFFERS GREATER FREEDOM THAN OTHER INVESTMENT CLASSES
Today, there are generally three ways to achieve real wealth: business, shares and property.
Many people start their own business to escape from a job, but often end up working twice as hard and benefiting only when they sell.
Shares can see massive value rises in a short time period, but their value can decline just as quickly.
Property is different: it is solid, stable and easy to understand; it is also fully supported by the government and banking systems. This is why you won’t likely see property owners panicking like shareholders might when the market takes a turn for the worse. Property can also be self-funded and provides a passive income.
The right investment decision varies depending on the individual, their goals and their risk appetite. However, most people will benefit from including residential property as part (if not all) of their investment strategy. Just remember to have some cash as a backup for unforeseen expenses, and always talk to a property expert who can help you with your investments before you begin.
BUILDING A PROFITABLE PORTFOLIO
I believe that property is the best possible investment – but the key to getting rewards is to buy smart. Make sure that you take into consideration factors that increase the property’s market desirability such as proximity to work places, public transport and leisure facilities. Also, be prepared to put in some research and footwork, or pay a professional to do this for you.
My investment strategy focuses on growth rather than rental returns. I believe you will do better by buying better, and when you can afford it. By steadily building a large portfolio, you can achieve solid long-term gains and cash flow to counteract any down times in the shorter term.
If you have twice the amount of assets, you should double your money and achieve freedom through property. This is why I advise investors to steadily build a large portfolio, with cash left over for emergencies.
By Chris Gray, Empire CEO