$$$Learn how to get RICH when you don’t have the CASH $$$

Sorry for the delay this week everyone –We have been very busy with our Ramsgate Project.    It has taken me a few extra days to get this blog out – but we are finally here.  Enjoy.

In this blog I had wanted to share a little secret on how to get rich.  Not a ‘get rich quick’ sort of scheme, but a build your wealth and increase your monthly residual income so you have more time to do the fun things sort of rich!

What I am talking about is not really a secret; thousands and thousands of people globally successfully utilize this technique each and everyday to increase their net worth! Many people though don’t really know where to start or how to make this happen.  Hopefully this can help, or even encourage some of my friends to find out how they can increase their wealth – PAINLESSLY!

Now don’t be offended  -  This blog is more for my Canadian friends as property investment is quite common place in Europe, where as Canadians are just a bit more skeptical and a bit more cautious.  RRSP, stocks, bonds , mutual funds are mass marketed to us by the big guys and like all great marketing – we buy straight into it.  Now I think I need to qualify my above statement and say that not all stocks, bonds, shares are bad.  There are however better, more effective and safer ways to earn money. Real Estate is one of those ways due to small word called LEVERAGE.

Leverage, by definition means ‘the use of credit to enhance one's speculative capacity’.  What you want to do essentially is to use other peoples money to make yourself more money.  The best part about this scheme is that the more money you make and the richer you become, the easier it will be to access more and more money.

Let me explain this a bit more detail.  Now first and foremost it’s important to work with professionals – and get all of the facts in front of you.  Don’t rush out and buy the house next door to grandma and expect to get rich.  It is not that simple.  You have to make sure you don’t get burned.  Borrowing to buy an asset – REAL ESTATE in this case can really intensify both the gains and the losses.  Done right though – can earn you substantial cash, and see huge capital gains!

Now let’s consider the following scenario; you purchase a house for $300k, and sell for $360k.

Purchase Price                     $300,000

Client Deposit                       $30,000

Capital Appreciation          $60,000

After-Sale Profit                    $30,000                                   $

Now granted the house only went up in value by 20%, but the ROI, or RETURN ON INVESTMENT IS 100%. That’s the power of leverage!

The key to successful leveraging is however – POSITIVE CASH FLOW! This means any income derived from renting out the property has to cover all the property expenses as well as the mortgage.  With this scenario, the property will continually earn you residual income every month, and you will never be in a position where you have to sell in a soft, or declining market; thus you will always be in a position to realize the capital appreciation.

Now come on my Canadian friends – lets get out there and make some money!