Most of the time budding property investors are hoping to become overnight millionaires.
They think property will be a quick fix to their financial problems, but the truth is seeking short term gains in real estate is more about speculation than strategic investing.
The primary reason that bricks and mortar is a long term prospect is that it lacks the liquidity and hence the volatility of other assets classes, such as shares.
In other words, it’s not all that easy to buy and sell property, and doing so will rarely make you rich overnight.
It takes time to sell real estate and then there are the numerous costs involved, including capital gains tax.
Where some might see this as a shortcoming, I see it as a strength; because property is a proven commodity that we all need, it has the tried and tested ability to provide steady, long term gains through the power of compounding.
In other words, you use the gains you make from one property to leverage into another property and then with the combined gains you make from those two properties, you buy more to add to your portfolio.
Better still, you can use other people’s money (borrowed from the banks) to do so.
No other commodity gives you the ability to do this so successfully.
By approaching property investment with patience and persistence, you will gain far more success (and wealth) than if you seek out the “next big thing”.
Securing proven, high performing property that grows consistently over the long term is the only way to ensure you make it to the top of the property ladder.