Living in a country like New Zealand can be very expensive. That’s why many people are looking towards the more affordable option of investing in real estate here. You can buy your own home, or you can invest in rental property investment for an even better cash flow. Many people might think that renting is just throwing away money, but it doesn’t have to be this way if you know how to manage your cash flow properly.
Benefits of Buying a Rental Property NZ
- Great Return on Investment
Rental properties do offer great returns on investments, especially when compared to low-interest rates that you would get with bank accounts and other stocks at the moment. So you could expect about 6% cash on cash returns each year, which is not too shabby at all if you ask me. - Capital Gains Tax Exemption
Rental properties are also exempt from capital gains tax which means that you won’t have to pay any taxes when you sell it for a profit after several years of renting it out. This makes the entire process even more profitable for those looking into making some serious money here. - Mortgage Payments are Lower Than Renting
Many people don’t realize this, but mortgage rates in New Zealand are lower than what you would be paying for rent in many cases. Of course, there’s still the chance that interest rates will go up at some point, but the risk with these investments is lower than with others. You also have the added benefit of deducting your mortgage interest payments from your taxes each year, which can save you even more money in the long run. - Leverage Your Money to Maximize Returns
Another thing that makes rental properties so great is that you can borrow money to buy them using mortgages. This will allow you to maximize your returns on investment as you’ll essentially be using other people’s money to make even more money yourself. - Automatic Tenant Screening and Selection
One of the best things about having a Buying a Rental Property NZ is that you don’t have to worry about finding tenants or screening them for suitability. Instead, this is all done automatically for you by the property management company you choose to work with. This can save you a lot of time and effort, which is especially important if you’re busy with other things in your life. - Hands-Off Management
Property management companies also take care of all the day-to-day tasks associated with renting out a property. This includes handling rent payments, dealing with repairs and maintenance issues, and even evicting tenants if necessary. So you can just sit back and relax while your property makes you passive income each month.
In conclusion, rental properties offer many advantages over other investment options, and it’s something that you should consider getting involved with if you don’t want to stay an employee for the rest of your life.
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