A Ten Year Strategy – Building Equity

Hutt Real Estate Agent

Real Estate Planning with Anna Manning

Investors should realistically take a ten year approach to building sufficient wealth through property that will assist with their retirement plans.

In general, past trends show that residential real estate values double every ten years, although the rate of growth can be much higher depending on the location of the property.
Some suburbs have achieved an annual price growth rate of more than 10% per annum over the last five years.

If an investor began to purchase well located properties, with high capital growth rates and good rental returns to help service the loans during the early part of this ten year strategy, then the equity in the investment homes would begin to accumulate over this ten year period.

Selecting high capital growth and strong cashflow properties in the early years will enable the investor to purchase additional properties during the first three years of this ten year strategy.
In addition, by year ten rental incomes should also have increased allowing the investor to accelerate payments to reduce the principal debt that is outstanding.

By adopting a ten year strategy towards property investment, investors will gradually accumulate wealth with a minimum risk, unlike other forms of investment.

The rate of wealth creation during this ten year period will depend upon the personal circumstances of the investor and their capacity to purchase investment properties. This is based upon the equity in their existing home and their initial selection of investment properties.

A key part of this ten year strategy is to only select high capital growth/strong cashflow properties, which underlines the need for the investor to seek expert advise before buying investment properties.

Anna is able to obtain a free rental appraisal for you on any property you are interested in.

Anna Manning is a Real Estate Agent at Leaders Real Estate Lower Hutt.
p 027 569 2749 e anna@huttrealestateagent.co.nz