When to invest in an income property. Most people know that real estate is a great investment. Over time it's a great way to build equity. In fact for most people, their home is their largest single investment. With the variety of equity financing vehicles available from Canadian banks, homeowners can now take money out of their home and invest it elsewhere.
So why is it a great idea to invest in an income property? The reasons are numerous.
- Return on Investment: In the past real estate has always outperformed the stock market. Of course most investment professionals recommend that any investment portfoloio be diversified.
- Tax Advanteges: All expenses related to the property are tax deductible.
- A Pension for the future: Because many Canadians lack adequate pension income, an investment property is an excellent way to create income. When rental income covers all financing costs of the property you are actually having your tenants do the saving for you. When the financing is paid off you have a nice flow of passive income.
- House your university age child: Many Canadians are sending their children off to other cities to attend university and housing them in their own revenue property. This saves on stucent residence fees and with the help of other student renters helps pay down the mortgage.
- Home improvement: If you're handy and can use your own labour, investment in an income property is a great way to build equity. Improving a property that needs a facelift can produce great short term results.
- Improved mortgage products: With as little as 10% down and amortizations up to 40 years ownership of a 2nd property is no longer for the wealthy only. Canadians can use equity in their own home to leverage their way into income property. For more information on how to put all the pieces together click here to go to my website. So when is the best time for you to own an income property?