Unlocking the Potential of Positive Gearing

You might have heard some real-estate investors complain about their investments not being profitable. This usually happens when the cost of owning and maintaining the property is greater than the income generated from it. If you are a real estate investor looking for tested and proven strategies for positive gearing, then you are at the right place.

What is Positive Gearing?
Positive gearing is like having a money-making machine. It is a situation in which the income generated from the rented property is greater than the expenses associated with owning and maintaining that property. In simple terms, your income is greater than your expenses, and you are making money out of it.

Choose the right property
Choosing the right property is like choosing the juiciest fruit from the tree. The first thing to consider for positive gearing is choosing the property where people really want to rent and live. Properties in safe and convenient areas tend to attract more clients. So, do your research and choose your property very carefully.

Do your calculations
Doing the math is like having a map that guides you on your journey. Before investing in the property, just do a simple math. Calculate the total cost involved in owning and maintaining the property by simply summing up your insurance, mortgage, maintenance, and all other costs. Then compare it with the rental income, and if rental income is more than the spending cost, that's a sign you're heading toward positive gearing territory.

Be smart about financing
Picking the right financing is like choosing the right vehicle for a road trip. You really need to have a good financing plan to make your property profitable. The ideal way is to opt for a fixed-rate mortgage, as it can help you plan better since your monthly payments won't change. Hence, choosing the best loan option to finance your investment can significantly impact your journey to positive gearing.

Add value to your investment
Investing in improvements is like planting seeds in a garden. When you make upgrades and add more value to your property, you can ask for more rent which can drastically increase your income from your expenses. To add value, you can make simple changes such as fresh paint, improving the garden, adding new furniture, and enhancing wall decorations. By doing so, you can attract high-rent-paying clients and achieve positive gearing. Just make sure the money you spend on improvements will bring you more rent in return.

You can also achieve positive gearing by just following these strategies. Make sure to do careful property selection, comprehensive financial analysis, reliable financing, and value addition to your property to make your investment in real estate profitable. So, start applying these tips today and start making a stable income from your real estate investment.