I am one of the few people in this world who loves what I do. I spend all of my time (well, most of it) with smart successful people who are serious about their future (i.e. investors), and I get to help them build their wealth and ensure they live comfortably their whole life. Not bad, eh?
I was crunching some numbers tonight for a new client of mine who is looking to invest about a quarter million dollars into multi family properties and small apartment buildings here in Kitchener Waterloo, Ontario, Canada. Their goal is to build their equity for retirement, rather than generate a steady growing cash flow (to supplement or replace income).
This is an important distinction, because the strategy when investing for cash flow is different from the strategy when you’re investing for equity appreciation. The two are completely different, and require different properties, financing, and often even different markets!
I want to share two sets of numbers with you, relating to how quickly you can build your wealth when you’re going for equity appreciation. In scenario 1, the client is buying $2.5 million in property, with 10% down ($250,000). In scenario 2, a more conservative 25% downpayment is used to buy $1,000,000 in property.
At the end of 5 years, scenario 1 has built the client’s equity from $250,000 to $650,840; scenario 2 grew the client’s equity from $250,000 to $401,225. Not too shabby!
The real magic in real estate investment comes from when you leverage that $650,840 into $6 million worth of property (or turn the $400K into $2 million in property) and repeat the whole growth process again. Nice way to build a GREAT retirement!
If you’re interested in how you can start building your wealth, give me a call. Even if you don’t have $250,000 to start with, you can start building your real estate investment portfolio today!
Benjamin Bach is a Sales Representative with Keller Williams Golden Triangle Realty in Kitchener Waterloo. He is passionate about building wealth for his clients, and loves nothing more than to help people start building equity and get on the road to financial freedom and abundance. He wakes up each morning excited to fulfill his mission of building wealth for his clients through comprehensive Real Estate investment planning, and helping people achieve success. If you are interested in how you can start your Real Estate portfolio, or have any questions about buying a home or selling a home, you can email Benjamin (benjamin AT benjaminbach.com) or reach him at 519 772 4376.