Do You Ever Feel Overwhelmed About Owing Your Investment Property?
THE GOOD AND THE BAD IS ALL PART OF THE JOURNEY
If you answered yes, you are not alone. Owning an investment property is a great way to create long-term wealth or equity through capital growth. Capital growth, in simple terms, is the increase in value of your property over time. It is calculated by determining the current market value and then deducting the price you initially purchased the property for.
For example: Market value – initial purchase price = Capital Growth
$850,000 – $430,000 = $420,000 Capital Growth
Achieving capital growth on your investment property can take time. Varying experts will state that it can take 7-12 years to see a significant long-term return on your investment. Therefore, if we look at the big picture of owning an investment property, it can generate great long-term returns (refer to the example above), which shows a gross 97.67% return.
While capital growth can offer investors significant long-term wealth creation opportunities, the journey of being a landlord can be challenging and tough at times. Navigating the changing market conditions; interest rate rises and weekly rent fluctuations (being your short-term annual rental income) can be overwhelming to some.
Tenant disputes, expensive repairs and renovations, damage to the property, tenants wanting to break their agreement, and negotiating awkward situations with tenants can all be contributing factors towards landlords feeling overwhelmed. Investors who enter the property market solely based on short-term returns, can find economic changes hard to navigate, and it is therefore important to remember the long-term gains. If you are currently experiencing financial hardship, there are solutions that can be explored, while you ride the wave towards long-term growth.
To reduce your sense of feeling overwhelmed is about understanding market conditions, knowing your rights, responsibilities, and obligations; establishing long-term strategies for navigating these tricky situations when they arise, and most importantly, establishing a realistic budget.
Our role as your managing agent, is to maximise your short-term return income, optimise long-term capital growth, provide skilful representation, and massage away any feelings of overwhelm through constant contact and communication with our valued clients.
The media regularly shares concerns about the current economy, constant legislation changes, as well as an overall uncertainty of the market. We understand these pressures that are being placed on some investors. It is for this reason we are here to listen to your concerns and provide professional and educated feedback on any questions you may have.
