The investment world is chock full of jargon, just one of these being leverage. You might have heard it bandied about if you've considered investing in other ways, but what does it mean for residential property investment? It's actually one of the benefits that makes real estate such a fantastic option for so many everyday New Zealanders. Let's take a look at what perks leveraging could bring you.
You can borrow more
Leveraging is a simple idea: It involves borrowing to fast track the returns on your investment. In essence, taking out a mortgage to buy a home is a form of leverage. Sure, you could pop all your savings into a term deposit to earn interest, but why not use a portion of it to grow your wealth in a property? After all, you'll be paying all those fees and charges anyway – why not make a little something to support yourself?
You might be a bit nervous about getting finance, especially if you're fresh off the block, but the great thing about investing in residential real estate is that you can buy with very little and achieve big things. Leveraging can help you fulfil your financial ambitions by accelerating the returns, based on the amount invested – not just the money you borrowed.
In fact, leveraging means you can purchase more property than you might have thought possible, and as the market grows, so to do your returns!
Manage the risk
Here at Goodlife, we love guiding and supporting people to accomplish their financial goals. We can help you become aware of the risks, coming up with a clear plan to financial freedom and bolstering it with property investment advice that's unique to your circumstances.
Here's to your financial independence!
Authorised Financial Adviser / Investment Property Expert
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