If you desire to build wealth with real estate, you're certainly in good company. Real Estate is probably the best asset class available, as well as one of the best investment vehicles, for wealth creation purposes. If you take a look at the 'Forbes 400 Richest Americans', or Australia's 'BRW Rich 200 List', or whichever list is available in your country, and look to see where the majority of those on the list made their fortunes, Real Estate will likely stand shoulder to shoulder with Business as the vehicles with which more people created their wealth than any other. Just ask Hans Jakobi. Sure, entertainers and sports people catch the newspaper headlines, but they really only account for a small proportion of self-made millionaires.
So what makes investment property stand out above all the other asset classes? There are 4 primary factors to investment property that make it a such a 'class' asset class, if you'll pardon the pun, for wealth creation. These are:
1. The Leverage one can obtain when purchasing investment property. This relates to the proportion of the purchase price that credit institutions are generally willing to lend on investment property purchases, typically 80% loan to value ratio, but this can go higher. Leverage is the secret power booster for your investing because you can put a 20% deposit into a property, and if it appreciates by 10% in value in the first year, you will have actually created a 50% return on your invested money.
2. The demand for property: we all need a roof over our head
3. The limited supply factor for property. Unlike condominiums or apartments, a real estate investment with a land component has a limited supply factor. Property developers can always add new high rise developments to dilute the supply of apartments in a particular area, but they cannot dilute the land supply available.
4. The price inflation that occurs on property. This can be due to growth in the economy over time, overall inflation in the economy, or simply demand in an area of limited supply.
We expand on each of these 4 elements in detail in our article on generating wealth with property investing, and reveal in detail the 4 elements that determine the price inflation of investment property. It is this price inflation, coupled with the high degree of leverage which can be achieved when purchasing investment property, that makes it such an outstanding asset class for wealth generation. Check out also our companion article about selecting the right investment property. Applying the right selection criteria on the investments you purchase will have an enourmous bearing on the investment returns that you will attain over time. There are also software programs now that analyze prospective real estate investments as you would stock investments. The Posh Property Program is an example of one of these.
There are also numerous Real Estate investment training courses in the Success Uni member's area, under the Elective Courses > Real Estate category. These courses comes from renowed experts such as Robert Allen, William Bronchick, Loral Langemeier and Claude Diamond. You can obtain a 14 Trial Access to Success University for only $2, and this is donated to a charity to feed children in need. Check out the courses available there, and then you can either choose to cancel within the 14 days, or to retain your Success University membership beyond the initial trial period.