Take Your Piece Of The Property Pie

“Ninety percent of all millionaires become so through owning real estate.” – Andrew Carnegie

If this percentage is so high, than why isn’t everyone investing in property? The number one reason why most people don’t invest in property is the fear factor. The fear of debt stops so many people from taking the next step. The critical thing that one must understand is the different between good and bad debt, as thoroughly detailed in Robert Kiyosaki’s books.

It is the collection of good debt that leads to wealth. This means buying or going into the type of debt that will return a healthy, positive capital growth or return. Good debt also refers to putting yourself into a position of using leverage to your advantage or using “other people’s money”. In the example of property, we might put down a 20% deposit, and the bank will let the other 80%. As long as you can maintain your loan repayments, it is you that gets to keep the capital growth, rather than the bank. If you didn’t borrow the money, you would miss out!

Although considered one of the safest investments by many, property also has its inherent risks. The number one tool for combating these risks is to do your research and find answers to all possible risks. Bad tenants can be combated with good insurance, a property slump can be combated by buying in blue chip areas and revaluing your property before the slump occurs.

Many consider property to buy to live in and pay off over 40 years. Yet owner occupied properties are not classed as assets, as Robert Kiyosaki would explain.

So why spend your entire life paying off your own home, when you can be far more profitable providing accommodation for others? When you start to look beyond the concept of just owning your own home, you will notice there are many, many different ways of investing in property. You need to find the strategy that fits you and your lifestyle. Will you buy property and hold? Will you buy property to renovate and sell? Will you take a step further into developing property?

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