Which property investing strategy do you focus on as an investor?
What if you’re starting out or you’re a more experienced property investor wanting to accelerate the growth of your property portfolio? Do you use a positive cashflow property investment strategy? Why positive cash flow properties?
Firstly a positive cashflow property investment strategy is one where the rental income from property exceeds all costs of ownership, including interest, council rates, insurance, property management and any other holding costs.
In other words, positive cash flow properties can actually put money in your pocket each month and as a result is paying you to hold the property. Get enough properties like this and you could replace your income and retire, if that’s your plan?
Positive cash flow properties sound almost too good to be true, right? Many property investors can’t believe positive cash flow deals exist in today’s property market. They believe cash flow property can’t be found as property prices went up faster than rents.
In fact, great positive cash flow properties can be found right now. If you understand how to look, what to look for and the secret to choosing the right positive cash flow property in the right area, you can get positive cash flow and capital growth in the same time…
Positive cashflow property investment strategy…are you an investor worried about what’s happening to the value of your properties?
Are you stuck or hitting a financial brick wall with you portfolio and can’t seem to move forward?
Fortunately there is a positive cashflow property investment strategy for making significant money which doesn’t rely on market-driven growth for success, and actually allows you to keep borrowing more to get multiple properties.
Understanding how to find and invest in the right kinds of positive cash flow deals allows you to buy literally dozens of properties, and effectively get paid to hold property regardless of what direction the property market goes in today’s property market.
Because in a flat or falling market, which is the market we are in today, do you want to see real-life current market examples of deals where you can buy properties with rental returns above 10 per cent, delivering substantial positive cash flow?
P.S. Would you want a massive instant equity gain? How about buying into a fully rented property, which delivers positive cash flow from day one? What if you can even subdivide the property to add more value…
Real estate funding and key fundamentals of investing in the Australian residential property market are where, what and when to buy. These fundamentals are driven by macro and micro indicators.
Macro indicators show where to invest so you can focus your attention on area’s population growth, public and private infrastructure spending, employment, supply and demand and economic health, etc…
Micro indicators show what to invest in determining property’s value, quality, design, amenities, access to transportation and rental income, etc…
Real estate funding as an investor, purchaser of property or property developer, at some point in your investing you’ll run out of cash. This becomes a into problems with financing as you start to take on bigger deals or more deals at once.
Real estate funding as you take your investing to the next level and leverage finance with the banks, you may be hit with the reality that you’ve reached a limit with your borrowing.
This can stop many investors dead in their tracks, although it need not be a reason for you to sit in the corner and do nothing until you’ve topped up your cash reserves, right?
Real estate funding is the simple answer where you ultimately tap into a world of unlimited other people’s money (OPM) to help you fund projects.
Real estate funding and the problems of inadequate comprehensive data: An executive summary is just an introduction to the project, not a comprehensive outline of the project.
A full detailed business plan which includes an executive summary, stabilized pro-forma income/expense data, complete development / construction costs data, sources and use of real estate funding data with viable exit strategy is required for review in order to determine project acceptability.
All project submissions must demonstrate control of significant physical and/or marketable assets to initially collateralize funding structure as a key component to attracting investment capital (bridge, mezzanine or equity) in context to collateral offered by the project principals, which secures the return of at least the invested principal amount.
This can be in the form of entitled and permitted market value of property or other owned real estate assets currently appraised in excess of investment amount or in the form of owned securities with a net future value equal to or greater than investment amount, ensuring the return of principal at term…
Real estate funding in context to insufficient owner equity and liquidity. Project owner’s should be able to demonstrate equity currently invested into the project and documented by the following:
(a) Documented control of property/land parcel
(b) Completed and approved site engineering
(c) Completed and approved architectural plans
(d) Documented municipal, state and federal permits, approvals for design, zoning and environmental
(e) Recent MAI full project appraisal/business valuation with feasibility, project financing, market studies
(f) Professionally presented business plan including pro-forma financial data and product marketing plan
(g) Experienced and dedicated management and advisory team comprised of industry specific professionals…
In addition, project ownership must provide evidence of ample liquidity in order to establish a valid capacity to compensate for the possibility of insufficient future cash flow should pro-forma projections not be met.
Real estate funding and lack of investor seed capital? This is the developers and project entities largest hurdle because without seed capital, none of the above can occur.
Real estate funding …it is crucial for you, the owner(s) of the project to find an investor or group of investors which believes in your project and has the available cash and/or assets to put up in order to back theproject financially.
The major issues with any investor or group of investors are safety of their principal, the projected return on investment in a relatively short time period, along with a percentage of future project profits.
As a first step, seed capital allows the developer to cover initial land and development costs (deposits, contracts, options, approvals, engineering, design, studies, appraisals, etc) which include completion of the documentation package required to prove the project bankable and qualify for applicable bridge, mezzanine and/or private equity capital leveraged by permanent financing commitments.
Real estate funding combined with opportunity and value guide you towards when to invest. Are you wanting to fast track your way into your firstproperty development because you don’t want to waste years in costly trial and error?
Research, knowledge and education allows you to confidently mitigate risks and decide what’s best for you, because you’ve analysed all the data factors above and matched these funding criterias to your own investment property goals…does that make sense?
Real Estate Funding
Australian property investors guide to property investments now, where to buy investment property, positive cash flow property using proven strategies to create wealth and financial freedom