Reasons Why a Rental Property Makes for a Good Investment


If you are thinking of entering the rental property market, you certainly wouldn’t be alone, and providing you do your research and can actually afford the buy and renovate the property to a high standard, there’s no reason why you can’t amass wealth. Here are just a few of the benefits you can expect to enjoy when you buy a rental property.

  1. Gaining Equity –From the day you purchase a rental property, your equity is building up, and what’s more, your tenant will be paying the mortgage on your behalf. While it might take a few years to really benefit, eventually, the mortgage will be paid off and you will own the property outright, and with the home loan paid off, you will receive a healthy profit every month when the rent is due. When buying a rental property, there are many costs involved, and here is a stamp duty Queensland calculator to help you determine the amount of stamp duty you will have to pay when you buy the property.
  1. Steadily Rising House Prices – Let’s face it, Brisbane land and house prices are never going to go down, rather it is only a question of how much they will rise. Imagine what the property will be worth in say, 5 or 10 years? From the moment you sign on the dotted line, your rental property is gaining in value, and the more time that goes by, the greater that value becomes. If you would like some confirmation that buying property is the best investment, there are a lot of online guides on the subject.
  1. Supply & Demand – Land is a limited asset and with more and more people occupying the planet, land will become more and more valuable over time, especially in a desirable location such as Brisbane. If you take the time to choose your property location well, you can expect top rate prices, should you ever decide to liquidate your investment.
  1. Your Tenant Repays the Home Loan – One very attractive side of owning a rental property is that your tenant is the one who is actually repaying the mortgage, and as the owner, you pocket the rest of the rent. Looking ahead to when the final mortgage payment is made, suddenly the monthly income from the rent can begin to accrue, ensuring that you have something put aside for a rainy day. Many people have amassed wealth by investing in rental properties, and if you enlist the help of a local property management company, for a small fee, they will take care of building maintenance, and some will even find and screen tenants.
  1. People Will Always Need Shelter – It doesn’t matter how much technology we have, people will always need to live in buildings, and so the market demand is always high. When you look at the price of land in Brisbane 20 years ago, you can see by how much land prices have risen, and there’s no reason why that won’t continue.

If you are soon to be adding to your investment portfolio in the form of a rental property, make sure you crunch the numbers and choose your location wisely, and as time passes, it will become more apparent that buying the property when you did was a smart move.

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