Think property investment is just for those who want to make a quick side buck? Think again as millionaires and billionaires from all parts of the world continue to put their money into this massively rewarding model.
In fact, did you know that 90% of the US’s millionaires have become wealthy by investing in property? And it’s a very similar story for the other millionaires of society across other countries and continents, too.
With more money being made with property than in all other industrial investments combined, let’s explore why exactly millionaires are drawn to property investment – and how you can use these reasons to attract more investors of your own.
Increase in Value
Regardless of the current global economic crisis, it is a fact that property will continue to increase in value over the years.
Imagine if you buy a tiny studio flat after scraping all your pennies together. That flat is likely to double in value a few years later and give you the means to put down a deposit for a slightly larger property (which will also increase in value – but this time, a little more).
Rinse and repeat this simple method, and you’re naturally going to see the rewards in your bank balance.
Research currently claims that the average price of a home in the UK will be around £457,433 by 2030 (source: propertypriceadvice.co.uk) – this alone should tell you what a sound investment brick and mortar continue to be.
Properties continue to generate income all year-round, even for owners who continue to hold down another full-time job, or even retire.
Those who partner with agencies that manage creative strategies such as rent-to-rent (or “rental arbitrage”) and short-term rental management are likely to see the biggest financial rewards, without putting in too much effort nor time.
As the short-term rental market increasingly expands, the property will also be a lucrative tool for making money. So long as property owners understand all the legal fees, guidelines, and regulations (and work with the right people) – this passive income can keep them on a healthy income for decades to come.
Incredible Tax Benefits
The wealthiest people collect properties in the same way they would collect cars. Interest rates are low, prices have fallen, and you don’t have to tie up a lot of cash in the investment.
Property also has incredible tax benefits. In certain situations, you’re not required to pay taxes on your gains on investment properties – however, the specifics will vary from country-to-country. Those who buy property in the most tax efficient way tend to reap the rewards in the long term.
A Vast Range of Options For Millionaires
Property investments offer the most “diverse” range of options when it comes to leveraging your assets.
Investments in stocks, bonds, or a private offering provide a limited number of choices, based on factors entirely out of your control. However, property can be refinanced, rehabbed, and rezoned – even if the rental market goes south, you will always have some way of making it worth your while.
As such, the flexibility of property investment is what draws the most shrewd millionaires towards it.