Maybe you’ve also wondered this. When making investment decisions you want to be sure that you’re doing so in a way that will lead to long-term positive outcomes. This was my answer when I was recently asked when is a good time to invest in rental properties: 

“Any time you can use someone else’s money to acquire an asset that will grow in value over time is a good time!”

How Does Investing in a Property Work?

When you invest in a rental property, you’re putting together a little bit of your money, plus a lot of money from the mortgage lender, and buying a property you can rent for more income than your mortgage payment and the maintenance expenses for the property.

Let’s say you bought the property now, for its current value of $600,000. You rent it out  (or it’s already rented) and you have a positive cash flow – but let’s assume it’s not a lot of money. In 10 years, even if we assume a very conservative 3% annual rate of growth in the value of the property, your $600,000 property would be worth $806,350. You could sell it, pay off your mortgage, which would then be about $370,000, recover your down payment of 120,000, and still have over $300,000 in net gain.

So How Do You Know When to Buy?

In short, it doesn’t matter when you buy – as long as you’re prepared to stay in it for the relatively long haul, the value of rental properties will continue to grow into the foreseeable future, slowed only by cyclical market corrections. This has been a very important part of my personal financial independence strategy, and I’m happy to share my knowledge with anyone.

Obviously, every situation is different, and that’s why you need someone with lots of experience to help you steer your course and advise you along the way.

Many people are concerned about the rate of return on their investments these days.

If you’ve ever thought about doing this, call us at 360-676-9600 and a team member can schedule a time for us to talk on the phone, so I can understand your thoughts and ideas about what you want to do, and I’ll share my experiences and suggestions to help get you started.