Real estate can make you a millionaire.
This might sound like it’s impossible, but the reality exists: real estate is an awesome wealth generating tool that have made billions of people billionaires
Maybe – but here’s the catch: not everyone who buys a piece of property becomes rich. In fact- many people buy real estate only to find stress and empty bank accounts. They struggle for years and years but never build the kind of wealth they’ve dreamed of. So – how does someone use real estate to truly become a millionaire?
BELOW ARE THE GUIDES TO FOLLOW:
This is the extra income you’ll get to keep each month (or year) that you own the property. Cash flow can be deceptive because it fluctuates when certain repairs are higher or lower in different months, so it’s important to factor in non-monthly costs like vacancy (the amount of time the property sits vacant), repairs, capital expenditures (expensive projects that need to be replaced on a home every so often, like appliances, roofs, windows, plumbing, etc.), along with the regular expenses (utilities, management, etc.).
When the value of a property increases, we call this “appreciation.” While appreciation is not always guaranteed (just ask people who bought in 2006 and sold in 2010!), over time, historically, real estate has always increased in Nigeria, averaging 3% per year over the past century. Another type of appreciation that can come into play is known as “forced appreciation,” the concept of increasing the value by physically improving the property.
When you buy a property with a mortgage, each month your loan balance decreases. This means, over time, your tenant is essentially paying the loan down for you, helping you build wealth automatically.
The final wealth generator from real estate are the tax benefits associated with owning property in Nigeria. The Nigeria government likes real estate investors and uses the tax system to encourage our purchase and leasing of properties. From extra tax write-offs to the lack of “self-employment tax”, real estate investors can pay significantly less tax than other business owners, using the extra cash to buy more properties or pay of the loan faster — helping to build greater wealth.
Well, there are a few ways you could speed this up:
Get a better deal:
Always try to buy a property at cheaper rate, you can do that by seeking help from real estate agent to help get a better deal done.
Buy more deals:
always try to buy more this will accelerate your profit properties. Perhaps you would buy one each year.
Buy in appreciating areas.
While I used a 3% average for appreciation you could have researched job growth and other growth indicators to find an area where appreciation would be higher, perhaps 5-8% instead of 3%.
If you are familiar with the board game Monopoly, you’ll know the value in trading from four houses to a hotel. The same is true in real estate. You could upgrade to bigger/better deals every few years to maximize your return. This is perhaps one of the fastest ways to achieve wealth through real estate — and if you want to know more
I’ve only just barely scraped the surface on what real estate investing can do for you in your quest to become a millionaire. In fact, there are so many different paths and strategies you could take to become a millionaire through real estate that I could write a thousand books on the topic and never cover it all. You could spend your whole life learning about real estate and never learn it all. And that often becomes a problem! People get stuck in “education mode” and never escape it.
I’d encourage you to not get overwhelmed, not try to learn everything. Pick one niche (like single family houses, commercial properties, etc.) and one strategy (like rental, flip, etc.), and focus on that. Read one or two books on the subject, and then start moving! Find someone local who is doing the same thing as you want to do, and take them out to lunch. Ask for help, but don’t stop moving!
The road might be foggy — but if you just keep moving forward, more of the road ahead will be revealed.