Back to School Pop Quiz:

Question: Which of these ways make money?
A. Income from Cash Flow
B. Income from Equity Build-up
C. Income from Depreciation or Appreciation
D. All of the Above

Answer: All of the Above!

You may be familiar with making money from real estate you own when the value goes up through appreciation. This is especially true when owning your own residence since the gains are tax free when you live there for two years.  Appreciation is not the only way to make money with investment real estate.

What are the four ways?

In addition, to gains from appreciation, when you properly purchase investment real estate, you always make money in four ways:
1) Income from Cash Flow (rent and other income),
2) Income from Equity Build-up (paying down the mortgage)
3) Income from Depreciation (Phantom Cash Flow, or paper losses for tax savings to offset income)
4) Income from Appreciation (the value of the property increasing over time)

Click here to see more in Robert Kiyosaki’s article on Entrepreneur.com

In this article, he goes on to say, “Do you pay rent for your business’s location? Both Donald [Trump] and I own the buildings that house our companies. Maybe you should, too. As tax time approaches, entrepreneurs become more aware of how taxes affect their bottom line. You may want to consider real estate an investment opportunity to increase your business success and accelerate your wealth. If you missed out on the last real estate boom, don’t miss the next one.”

Contact us to review your acquisition criteria to see if buying investment real estate would be right for your situation.

Filed under: Benefits of Owning Property, Building Equity, Cash Flow, Commercial Real Estate, Depreciation, Save Tax