What Happens When I Buy Three or More Investment Properties?
With the property market in Australia being very competitive right now, many Australians choose to purchase investment properties. Not only do investment properties allow for you to earn rental income, but they are also a great way to improve your financial situation and grow your wealth. Most investors only own one or two properties, but there are benefits to owning three or more.
Benefits of owning three or more investment properties
Owning multiple investment properties offers you the chance for the following:
- Greater capital growth
- Higher passive income
- More financial security
- A chance at financial freedom
Many of the benefits of owning multiple investment properties have to do with the wealth you can accrue over the years. If property values increase, the gains you see are multiplied with each investment property you have. However, the reverse is also true, leading us to some of the biggest cons of owning multiple investment properties.
Cons of owning multiple investment properties
- They can be challenging to manage. Between scheduling maintenance, keeping up with repairs, and making sure all your tenants pay their rent, managing investment properties could easily be a full-time job.
- Investment properties can take a while to sell. The sale of investment properties is not as straightforward as selling owner-occupied homes because they are not liquid assets.
- You can quickly lose money. If property values tank, the loss is multiplied across all of your properties. Instead of seeing a loss of $10,000 on one property, you would see a loss of $30,000 across three properties.
At Mortgage House, we understand the desire of many Australians to purchase an investment property. We can help make the process easier. If you already have an investment property, we can help you buy another one as we walk you through the risks. In addition, we can help you find investment loans at competitive rates.