Tuesday, 1 November 2011

Having your cake and eating it too - Cash Flow and Capital Growth

Having your cake and eating it too - Cash Flow and Capital Growth The whole point of buying property as an investment is to see an increase to the value of the asset, and the greatest possible income from that asset during the time that the investor owns it. You couldn’t imagine anyone wanting to buy property that doesn’t grow well and has a low rental yield! The whole point of buying property as an investment is to see an increase to the value of the asset, and the greatest possible income from that asset during the time that the investor own
But some investors do believe that they cannot have both cash flow and growth at the same time. Some ‘experts’ have created this misconception by continuing to validate the theory that a property can only have one of these characteristics, either cash flow or growth.

This is simply not true. Throughout her new book, Investing in the Right Property Now!, http://majorstreet.com.au/investing-in-the-right-property-now/ 

Margaret Lomas shows you that while some property has good growth with low yields, and others have good yields with low growth, the best property is that which has both! Further, buying property which has both is not only highly possible, but such property always exists somewhere, regardless of the present state of the economy.

As an investor, your goal must be to ensure that each property you purchase provides the best possible growth, for the best possible rental yield, during the period that you own it. You want your purchase to have its best performance – its greatest period of growth and most attractive rental yield – when you need it most. Some  high income-earners seek growth first then yield later, for others it is the reverse. Margaret takes an in-depth look at both cash flow and growth, and explains how to choose property that gives you what you really need from your property investing.


Original Link

http://majorstreet.com.au/53/investing-in-the-right-proeprty-now/

3 comments:

  1. In Australia, properties with higher capital growth usually have lower rental returns. In many regional centres and secondary locations you could achieve a high rental return on your investment property but, in general, you would get poor long-term capital growth.

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  2. Some areas in regional Australia have both, especially in the mining boom areas which also have a lot of other investment happening.

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  3. You made some good points there. I did a search on the topic and found most people will agree with your blog.


    thanks
    Cash Flow Properties In USA

    ReplyDelete