Why property can be your ticket to freedom

Investing in residential property is attractive to many, but a vast number of would-be investors shy away from, or procrastinate, getting into the market. It is a common perception that property ownership can limit your freedom – but nothing could be further from the truth. Smart investors focus on steadily building up their portfolio and their reward is a dependable asset that affords them a fantastic lifestyle.

Over time, a considered property investment strategy will start to provide you with long term rewards and the freedom to focus on a job you love, take time off to travel or raise a family, all the while knowing you are backed by a bricks-and-mortar asset that is constantly working at building your wealth.

How to achieve capital growth through property

Investors hoping to achieve the greatest financial freedom from property need to focus on buying well and steadily building up a portfolio. Once you have one appreciating asset you can build up equity which you use to purchase your next property – without having to fund it from your wages. It took me nine years to gain financial freedom through property investing alone. But once I had the assets I could abandon my 9-to-5 job at age 31 and focus on my investments. In the same time frame, well-chosen properties in key hubs in Australia generally double in their value and produce consistent yields. This represents far better returns than those achieved by other assets, such as shares, and is why I believe property can offer investors the ultimate ticket to freedom.

Now I’m free to focus on what I love – property, television and education – through my buyer’s agency Empire and various TV roles, including hosting Your Money Your Call on Sky News Business Channel and various speaking engagements where I teach others how to build financial freedom through property.

Property can offer greater freedom than other investment classes

Today, there are generally three ways to achieve real wealth: business, shares or property. Many people start their own business to escape from a job, but often end up working twice as hard – and only benefit when they sell.

While shares can see massive value rises in a short time period, their value can decline just as quickly. Australian property weathered the worst of the GFC far better than the share market, and began recovering sooner.

Property is different: it is solid and easy to understand; it is fully supported by the government and banking system and it is stable. This is why property owners don’t panic like shareholders might. Property can also be self-funded and provides a passive income. The right investment decision varies depending on the individual, their goals and how comfortable they are with risk. 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 of a company that can help you with your investments before you begin.

Make your property self-funding

Many people struggle to cash flow the differences between rent in and mortgage out. The key is to use capital gain to finance that difference, rather than selling. This will allow you to forego expensive transaction costs and capital gains taxes, while holding on to a value-appreciating asset.

Building a profitable portfolio

The key here is to buy well. Take into consideration factors that will increase the property’s market desirability. These include proximity to work places, public transport and leisure facilities. 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 as you can afford it. By steadily building a large portfolio you can achieve solid long term gains and cash flow the property to counteract any down times in the shorter term.

If you have twice the assets you should make twice as much money and achieve freedom through property. This is why I advise investors to steadily build a large portfolio, with cash left over for emergencies.

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