Most Aussie property owners will buy their first home and never go beyond thinking of buying another one as an investment property. In this article, we will discuss the benefits of owning more than one home.
What benefits do I get from multiple properties?
Of course, you want to know how owning multiple investment properties work for you. There are many benefits that come with owning more than a single property and it’s a shame many investors never get around to taking advantage of more than one investment property.
Increased capital growth. Owning multiple properties mean you can have higher capital growth potential. Let’s say for instance you own one property valued at $500,000 and its market value increases 10% then you make 50,000. Naturally, owning 2 of those properties would make you $100,000. More property means a greater chance of achieving good capital gains.
You are the boss. Investing in an income property will make you your own boss. Do it right and you can even resign from your work to focus on being a landlord. As the owner, you choose the tenants you will rent it to, how much you’ll charge, and how you will maintain and manage the property as a whole.
Awesome passive income. Purchasing a property in a good community at the right time like the best value house and land packages in Sydney will give you not just great capital growth, but passive income as well, this is according to the recent 2017 ANZ/Property Council Survey.
By owning multiple properties, you get more passive income and lets you take advantage of inflation and increasing rents across many properties, which means your passive income has the potential to increase every single year. Over time, you may be able to use the excess cash flow to pay off your mortgage and you’ll really see a boost in passive income. Eventually, this may be enough to retire early or purchase another property.
Greater financial security. A diversified property portfolio lets you gain even more financial security. If you only own one property and something happens to it (flood, fire, hurricane, etc.) your options will be limited. Either you rent or go live with relatives for a while. Owning more than one property means you can rent them or use others as an alternative home during trying times.
Property price growth is anticipated. In New South Wales alone, the price growth index has progressively risen over the past four surveys, though it declined a bit in March 2016 when Sydney’s median house price dipped below $1 million. The strongest opportunities of growth were focused in New South Wales, followed by the Australian Capital Territory, South Australia, and Victoria.
It can be hard to achieve financial freedom if you own just a single property – not unless you have a ridiculously high-paying job or lucrative business. Accumulating multiple investment properties can make financial freedom much more achievable if you play your cards right.
So, have you decided on buying a second property? Do you know other benefits of owning multiple investment homes? Share it with us in the comments below.