Portfolio Building & Capital Growth
Building a portfolio takes time and alot of strategic analysis. Most people don’t have the time or resources and most investors fall short of accumulating a portfolio that has the size to create real wealth and passive income for an early retirement. Most investors get stuck at only two properties, if not just one. The stats are clear on this, the average investor acquires property that doesn’t generate capital growth or the proper income to pay down debt to reproduce funding for additional investments.
Fortunately for our clients, our team handles all of the heavy lifting along the way, we guide clients along their personal roadmap to achieve long term goals.
Our clients are portfolio builders and long term owners of investment property.
The more asset value you have when a price rise occurs, the more substantial your equity position becomes. You can use this equity to buy again, duplicating the process over and over. Duplication is key to portfolio building.
Legacy System creates endless opportunities for asset accumulation, enabling clients to leverage equity when it becomes available to invest in more appreciating assets. Debt is paid down as you go.
Portfolio building starts with just one strategic investment – just one leap of faith. That one strategic purchase of real estate, combined with to reduce debt, can power you to accumulate dozens of homes over the course of your lifetime.
Holding real estate investments for the long term enables an investor to experience multiple price growth periods. In some years there may be very little growth, in other years there may be minor increases, and other times there’ll be a period of substantial price hike. The media calls this a boom. But most of the time it’s just pricing catching up with the long term fundamentals of growth.
Let say you invest in a $450,000 property in an area that will average 6% capital growth per year. And you hold that investment for 10 years. The valuation is now $805,881.
Let’s say you hold that same investment for 15 years. The valuation will be $1.017m.
For 20 years? $1.44m.
By that point, if you’re following our Legacy System you would be paying down that debt, or have it paid off entirely. But let’s say you didn’t pay off the debt, the mortgage would remain at the same level as when you purchased the asset. Your equity would be approximately $1.020m.
Now let’s say you had 5 of those properties that grew at the same rate. You’d have $7.2m worth of asset valuations, with an equity position of $5.1m.
Rents increase over time, increasing your passive income.
Holding assets for 15 plus years is essential to building real wealth and cash flow. If you sell a property, you may make a profit at the time, but then you miss out on all the future profits.
Holding long term is possible if you have the right buying process and structure. The more assets you have you in your portfolio when a price hike occurs, the more wealth you’ll generate.
The Legacy System also demonstrates to you how you can pay down the debt as you go, therefore once you reach retirement age, you can live debt free, or with very minimal debt, enabling you to live off the passive income from the assets. Read on to learn more.
