Does this sound familiar?
Go to University, get married, have a family and buy a home because rent is a waste of money because you’re helping pay someone else’s mortgage.
Too familiar right?
And yes, we’re told from the beginning to buy a home as soon as we can so you’re paying for your home and not someone else’s. And to a certain degree this is true, but ask any savvy investor and they’ll tell you that renting is the best strategy when it comes to building a property portfolio, but why is this?
If you’ve been following us for some time, you’ve most likely heard the term “invest where you’ll make money and rent where you want to live”, but what exactly does that mean?
It goes against everything we’ve been taught about money and wealth, right?
And you’re right, so let us show you a new way to look at money, which is actually a very old method that many have been using for decades but may just aren’t aware.
Invest your money where growth will happen, thus growing your investment value and your wealth, then live where you want because more than likely, if we use say Bondi as an example, where you can rent a new 2 bedroom, 2 bathroom apartment within walking distance of the beach valued at $1.9million for $1400 per week, is a great deal as a renter because the rental yield for the owner is only 3.6% meaning you’re paying less than their mortgage payments.
So you get the luxury of living in a beautiful home for a fraction of the price if you bought the home yourself. Or you can do the opposite and live in an area you don’t love in a house that you can afford but don’t love, and you’ll spend the next 40 years paying off. And yes, 40 years is the average length for mortgages these days.
The choice is yours, but you know what I would do, so which would you prefer?
To find out more, our Senior Investment Strategist, Keshav Mehra made a video explaining this exact method, which you can watch right now by clicking here.
