« Short Sale Professionals And Lenders Should Work Together | Home | Did Somebody Say We Couldn’t? »
Property The Great Retirement Fund
By Vic Hurlstorm | July 21, 2010
Sometimes a question is asked as to why people buy another property. The reasoning behind purchasing investment houses is the retirement income potential they provide. By purchasing income properties now will get you a good retirement fund over the next ten or so years time.
Take a look at this model. Many families own one home which they live in and they pay the mortgage on it. There will also be other bills to pay out as well such as the council tax and bills on electricity and gas. The homeowner will need to work to stay on top of the bills and keep up with the mortgage payments. They will also have to pay the taxes which also come with the job which is another big lump out of their source of income. On all the bills you have to pay as well as your income tax can be as much as two thirds of your income. allowing only a third of the wages left for spending.
Most people are just happy to pay off their own mortgage and own their own home. That still means the supplementary bills will have to be paid like electricty and gas even without the mortgage payments. This means you still have to keep your job to pay the bills.
The resolution is to have a passive income coming in. This source will continuously bring you in an income, so you will have funds coming in all the time. That’s why owning other properties is crucial. Still if you have a mortgage on the income properties, you just have to make sure that the rent that they are producing is more than the cost of the mortgage. That means you will be getting a passive income all the time.
As the years go on, your properties will increase in value and your rents should increase too. Now even if you had just a couple of extra properties and they were on repayment mortgages they will all be owned by you when the term finishes. The money earned from these properties should be sufficient to pay all your utility bills and give you a unsparing liifestyle
Another reason to use income producing houses for income is that you don’t physically have to be around to run them. You can use agents to run it for you and other individuals to do the maintenance. This means the cash can roll in while you are not there. I love to be in my St James Barbados Accommodation while my properties are earning me money. Maybe you picture that sort of situation too, that you be lying on the beach on a Barbados All Inclusive holiday, when your properties are providing your income.
Topics: investment properties | No Comments »