Tag Archives: capital gains

Investing for Positive Cash Flow

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Investing for positive cash flow (also known as positive gearing) means buying an investment property that has a high enough rental return in order to cover all holding expenses and still have some cash left over.

This is easier said than done.

In most capital cities, rental yields average around 5%.  Therefore if you are paying 7% on your mortgage and 1% for other expenses (such as insurances, council fees, body corporation fees etc) you are making a 5% minus 8% equals -3% cash loss.  That is negative cash flow and you have to put in your own money every month to hold onto that property.

Property Investing for Capital Growth

Investing for Capital Growth

Capital Growth which is also called Asset Appreciation, is the main aim for most property investors.  Capital growth is when the value of your property increases over time.

But, how to achieve it?

Well, it’s not that difficult as property is a popular investment class which has shown to move up over the long term.  However, it is not enough to just go out and buy any old property.