Thursday, 21 February 2008

7 Steps to Becoming a Property Millionaire, Part 1: Why Property?

Property or real estate has been and always will be one of the best ways for creating and holding wealth. So, I will now focus on the topic of property investment and how to create a million dollar net worth in property in a few short years.

At present I don’t actually have any property investment but looking to get into it within the next year or two. However, Keith Mason is a successful property investor who has outlined the plan and steps required to creating a million dollar in property in his very informative e-book, which you can download for free.

Before we get into the details, let’s have look at some of the reasons that make property investment a great option for building wealth.
  • Anyone can do it. Studies show that over 80% of the world’s millionaires hold their wealth in property. A large portion of the rich 200 in BRW made and are continuing to create their wealth from property.

  • Easy to understand. Property investment is generally easily understood and doesn’t require an in depth technical knowledge as compared to share trading. However, it does require a certain level of sophistication and strategy.

  • Tangibility. Property investment provides tangible evidence of where your hard earned money is going. It can be very satisfying to walk through your own property.

  • Potential to add value. Property provides the investor with the opportunity to improve value either through renovation or development.

  • High Gearing. Property enables investors with relatively small amounts of money to obtain exposure to relatively large assets.

  • High long term results. Property has historically provided high long term returns, in the order of 9-12% return per annum on average.

  • Tax efficiently. Property has a high degree of tax efficiency for a number of reasons. Firstly, its returns are comprised of growth component that may be concessionally taxed (if held for over 12 months) using the capital gains tax discount. Secondly, property can be highly geared which results in a tax deductible interest component. Thirdly, property allows the deduction of a depreciation component for building write off and plant and equipment, which improve tax return.
Now let's find out how to create a million dollar net worth in real estate in just a few quick steps...


Anonymous said...

The best investment on earth, is the earth itself!