Congratulations, you’ve finally found a source of information that is valuable and easy to apply for future investment decisions’
We have read many books, reports and articles on investment, the investment goods in particular’ Most of them contain much information, sometimes even give you instructions on how to implement it’ However, none of them seems to be the missing ingredient to make an article on the result’ His form of “information is never complete, too complex or too simplified’
Finally, all our research, we found a significant difference in the information provided by other authors –
They do not know why it would do well to invest in the first place!
Not explain how to measure their investment!
What is the point of investing if you do not have a clear objective in mind? And if you have a result in mind, how do you know that the investment will achieve its desired goal?
We have heard repeatedly that people who wish to purchase an investment property, without knowing why they are buying an investment property in the first place’ Sondé not have the answer as empty, vague statements and complete lack of understanding of the questions’
Ask yourself why buy an investment property?
Is it to create more wealth in the future?
Is it to help financially on a daily basis?
Is it to generate a return on investment?
Is it because the investment property is a better investment than stocks?
Do you have answers to these questions? If you do, how are some of the answers?
We found that people tend to answer yes to all this, without any particular outcome in mind’
This report will give the main tool you need to start answering the questions above’
This tool is the ability to measure the return on invested funds’
If you can not measure their return, one can never achieve their goals, achieved through luck and not the objective, measured approach’ The opportunity does not allow you to repeat their investment strategies’ It’s just good luck in the casinos!
Therefore, a comment can you measure performance?
Let’s step back and consider what a return on your investment’ When it comes to rate of return or return on investment in dollars, which define these returns over time and the basic investment’
For example, if you bought a property for $ 200,000, 1 year after the property could be worth $ 210,000′ Therefore, your ROI is $ 10,000 in a year or 5% a year’ This example has a period in which the return is measured’
However, when a measure of ROI, it is necessary to measure the performance of the full price of the investment? When you buy an investment property, buying property in cash? Certainly, some very unusual and suspicious circumstances, sometimes to buy goods for their money! You agree with us when we say this is extremely rare’ In most cases, investment property is purchased with a combination of money and bank money’
In fact, in most cases, the bank provides most of the purchase price – 70% to 90% of the purchase price’ This means that, in general, you can set up your own cash as a fraction of the price of real estate’ Because the survey only 10% to 20% of the total purchase price, when working in the ROI, why do you work on your return on investment based on the total cost of ownership? Who have not purchased the property with the money, so you do not need to work on the return on investment for the full price of the property’
We can provide an example of this in another area’ Say you want to buy an old dresser drawer’ You know that even the antiques in price over time, especially if they are properly Soignes’
This should cost $ 1000′ You do not have $ 1000 $ 800 if delivered to a friend and put up the remaining $ 200′ You made an agreement with a friend at the end of the year when the currency is sold, you pay $ 40 for the loan’ At the end of the year, which managed to sell the book for $ 1100, or for an extra $ 100′ So you may think you’ve made 10% return’
O $ 100 profit divided by the purchase price of $ 1000′ You would be wrong’ What actually the benefit was $ 100 minus $ 40 that you should give your friend for the loan’ That makes $ 60 profit for you’ To calculate your return, you must divide your $ 60 profit for every $ 200 of your investment’ This means that you have 30%’ Just calculate the return on your money is not your friend and not the total purchase price of the old hall’
Here is an example of how your real estate investment sera’ The figures are deliberately simplified and do not take into account the different costs:
Example 1 – Return on investment on the basis of property acquired with a contribution of $ 200,000 for 20% of its own money’
Purchase price $ 200,000
Price increase in year 1 $ 10,000
ROI in 1 year to 5% (calculated by dividing the increase in purchase price)
Example 2 – Return on investment on the basis of property acquired with a contribution of $ 200,000 for 20% of its own money’
Purchase price $ 200,000
Your investment of 20% $ 40,000
Price increase in year 1 $ 10,000
The return on investment for 1 year 25% (calculated by dividing the increase in the price of your investment)
In both cases, the cost of ownership and increase in the same price and at the same time period’ However, in example 2, the ROI is calculated on the account that you have in the property’ The difference is huge – 500%’
You see, in this example, the bank lends 80% of property value is a return on their investment’ It’s called interest’ They do not need to give them a share of ownership and satisfaction’ Given this, could not receive the full value of the property to calculate your return on investment’
Of course, it’s not as simple as that’ There are other considerations to be included in the calculations, to be precise, but the basic idea is correct’ If you have begun to apply this method to calculate your ROI, you’ll find that investment property is a high-yield investment return of 20% to 100% per annum on your investment’ Investment properties superior to the rival party and performance by eliminating the volatility and the risk of their investment’
You’ve heard of the so-called experts that investment will always be lower than the ownership of shares and other investments’ You have heard that the only way to receive high returns on investment in property through appreciation (price growth)’ You’ve heard that the rent should not give a high yield’ You’ve heard that you should use debt negatively when investing in real estate for express return’ Unfortunately, none of these statements are true’
We will demonstrate why ””
To take one example, the following variables:
Details of the acquisition and investment:
Purchase Price (nine 2-bedroom unit) $ 185,000
Bank loans – 80% $ 148,000
Interest on loans (interest rate of 5%) $ 7,400
Your contribution – 20% (your money) $ 37,000
Cash flow information:
Locating a (gross) $ 10′140
Total expenditure (property management, insurance, etc’) $ 3,100
Rental per annum (net – rental income after all expenses) $ 7′040
Total deductions from income tax of $ 1960
Nett Total rental income, plus $ 9,000 of tax relief
In this example we can see that his position on the possession of this property, you have a bill of $ 7400 and $ 9,000 in interest income’ Therefore, you will be a surplus of $ 1,400 per year’ What does this mean, if you work on your return on investment?
Well, you earned $ 1400 in its initial cash investment of $ 37,000 (contribution to the acquisition of property)’ This represents a return on your initial cash investment of 3′8%’ It’s just me and you say you would agree with you’ That has not elected a ”’ This property is money you pay to the owner’ You just bought a property that is paid from day one’
What happens to the property long term? In general, the properties go up in price’ In fact, the average increase in prices over the past 100 years, consists of 7% per year’ If this reasoning applies to the example above, 7% increase over the initial purchase price of $ 185,000 is $ 12,950′
Therefore, to calculate the total return of your initial investment CASH, must do the following ””’
1′ Add rental income and tax deductions for pricing’
* $ 1,400 + $ 12,950 = $ 14,350
2′ Work on the total return on your investment by dividing the top of your investment
* $ 14,350 / $ 37,000 = 39%
Incredible, their initial investment of $ 37,000 for the purchase of the property received 39% return on their money in the first year’ Of course, unlike the hand can not withdraw the money and take advantage of this immediately’ Thanks to the property, you must wait some time before they can collect their entirety’
To give an annual yield of 39% of your money in perspective, is 10 times the bank to pay’ It is 4 times higher than professional fund managers strive to achieve – the same as those that are paid millions in bonds’ It is almost 2 times larger than the planet’s richest man, Warren Buffet, always’
How does all of its investments or any investment of this size? Where can I buy a property and pay the first day and the price increase? Remember appreciated cycles, but always appreciated’
That is what the professionals know and do not appear to explain the whole world’ You can now calculate the return on real feedback on your money, no money in the bank’ You do not have to work on the return on bank money, banks can do it themselves’ We need to worry about their money’ So when you do the math right, you’ll find that in all the right to purchase capital goods, is up to 100% return on their money’ In the worst case you will have only 30%’ However, it becomes a phenomenal high by usual standards’
All this can be done safely, and in some cases, absolutely guaranteed rent!
Now what do I do?
Hopefully we have shown that the property is notable that the investment is difficult to replace’ Not all properties are the same, and should take care to empty in May for long periods of time or have lower tax deductions’
Viva Properties has a department of education that teaches people of the freedom of property investment – various traps, techniques for minimizing risk in the early repayment of loans, access to the properties of a discount etc’ ” We teach in small shops ranging from 10 to 20′ During the workshops that are incredible data on how property investment and the work of new knowledge is applied to goods including examples examiner’
[tags]Investment Helps,Investment Guides,Investment Planner,Invest Offshore,Investment Adviser[/tags]