Tuesday, 21 July 2009

Why Property investments?

With property investments, which I believe it is one of the most interesting and profitable investments available. Also it is a great way to make money work for you.

The reasons why i'm so passionate about property investments are that it is fun, exciting and profitable. Here are some of my reasons why i love properties :
  • Buying a property cheap - buying anything cheaper than it should it's always exciting and fun and gets the frills and satisfaction of potential profits
  • Ability to add value, renovate, redecorate or furnish a property. Eg you can repaint the whole house, add a additional room or extension, change the fixtures, fit a new kitchen or bathroom, new furniture, etc
  • Flexibility and control by using different strategy you can determine you financial gains
  • and finally, it's exciting to see money coming in
There are usually several finance gain from property investment
  • Cash flow - Cash is king, this is so important in any business, but it is also essential in property investments. This is where the expenses (mortgage, maintenance, service charges and letting fees, etc) are less than your rental income. Eg if you get £600 rent and your expenses are only £500, you have a cash flow of £100.
  • Capital growth - potential capital growth, on average property prices in the UK doubles every 7-10 years, therefore if you bought a house in say year 1990, in year 2000 it is likely it would be more than double in price. Those of you have bought your own home for sometime, the house price would have gone up significantly. But in this current credit crunching recession times, don't think about capital growth as it is unlikely to see major growth for some time.
  • Tax advantages - Having a BTL property is a business, you will need to file a tax return. But it does mean that while you spend time building up/running your property business, a number of expenses can be claimed (eg food, travel, furniture, etc) therefore minimising your tax expenses. But seek an accountant with property investment knowledge for advice.
So think about investing in properties in the future!



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