As an example, if you had £20000 to invest;
which would be the most lucrative option?
A
bank account or a property?
If
you put the money in a high interest bank account paying
5% interest a year, you would receive a gain of £1000
after the first year. Not bad.
If
you use the £20,000 as a 20% deposit on a £100,000
property that has a rental yield of 6%; you would receive
a gain of £6000. This is because the gain is on
the whole £100,000 property rather than the £20,000
invested.
Anyone
can plainly see that this is a MASSIVE difference in
the return on investment and this does not take into
account the possibility of capital growth.
If
the property increases in value by 5% in the first year
of ownership, then your gain would be increased to £11,000.
LEVERAGING
is a very simple process; you invest as little of your
own money as you can and borrow as much as possible
from someone else... This
is the way that many PROPERTY MILLIONAIRES have made
their fortune.
As
an example, you buy a property for £100,000; should
you put in a high amount of capital? If you put in 50%,
borrow the other 50%, then the property goes up in value
by 25% to £125,000, you would have made £25,000
which is a 50% return on your £50,000 investment.
If you had put in 20% and borrowed the other 80%, you
would still have made £25,000, however the return
on investment would have shot up to 125%! Nice!
Sky
Rocket your wealth potential by contacting a BROKER
to discuss your options!
Article
supplied by Site Administrator RC |
