Noah George - 3 Advantages You Gain When Investing In Cash Flow Property

Cash flow property advantages are truly hidden from the general public. Think about it. Have you ever sat down with a financial planner and wondered why he has never recommended that you take your money and invest in cash flow properties? Noah George means really many of the wealthiest people in the world have used cash flow property to literally build empires!

While you are pondering that question, think about this: cash flow property when compared to “traditional” investments peddled by many “financial planners” may provide higher returns with less risk and more control to you, as the investor.

Cash Flow: Is the amount of cash that an investment or business venture creates over a specified period of time. Since cash flow or cash is the primary driver of a business and gives business owners the freedom to create more products, services, or even pay dividends to shareholders, most analysts believe cash flow to be a company’s most highly regarded financial statistic.

Noah George is almost always takeover because the buyer knows that the cash can be used to help balance the costs of the purchase deal.

So, first and foremost, understand that there is a difference between investing and speculating. An investor will buy cash flow, while a speculator will bet on a rise in price or buying low with the hope of selling in the future at a higher price. In the investment property world, speculators are known as “flippers”. This is a topic for another discussion, yet just know there is a difference.

Advantage 1: When buying cashflow property, I am creating a recurring income stream. So, when I invest my cash in a property that I will in turn rent to a tenant, I am effectively being paid for having put my money at risk. The tenant will pay me to live there which creates my income for the property. Having income from the property gives me a steady stream of cash flowing to me which I am free to use.

Advantage 2: Buying a cashflow property creates an asset. What does that mean? It simply means that you now control or own something that pays you! The real difference between assets and liabilities is that assets pay you and liabilities require payment from you. Your personal residence is not an asset, it is a liability! It requires payment from you in the form of a mortgage. Even if your home is paid for, it requires payment from you in the form of taxes, insurance, and upkeep to name a few. In reality, your house is an asset for the bank that owns your mortgage or the state and federal government that collects your property tax, and the maintenance man who does your lawn… For you though, your home is a liability!

Advantage 3: Buying cash flow property creates tax advantages. That’s right. And, probably one of the most misunderstood tax advantages is that of depreciation or “phantom cash” as some call it. Basically, phantom cash (or depreciation) can be taken literally as just that, it is money that doesn’t exist. Depreciation is a government incentive and tax loophole of the rich so they can benefit from real estate to a greater extent.

Noah George - The Golden Rules of Property Investing

As our economy moves forward and a new property cycle begins, fortunes will be made by some group of investors. But if history repeats itself, many property investors won’t get the financial independence they deserve, so I want to share my time tested golden rules of property investing so you have a roadmap to help you through the next property wave.

Invest, don’t speculate

Noah George is investing in property, many property investors are actually “speculating.” They buy a property emotionally, often near where they live, where they holiday or where they want to retire and then hope or pray that the market will appreciate. They are totally dependent on outside market conditions to produce a profit.

It’s about the property

During the boom, many investors forgot the age-old property fundamentals of buying the best property they could afford in a proven location. Instead, they got sidetracked by glamorous finance or tax strategies and some lost out.

Land appreciates

While most investors recognize that land appreciates in value, it’s not as simple as that. Not all land is made equal and not all land appreciates at the same rate. In the outer suburbs of our capital cities, there’s lots of land (ample supply) and much of the demand comes from a small segment of the market — first home buyers (restricted demand). This keeps a lid on capital growth and makes these areas poor investment prospects.

Buy Property that is in continuous strong demand

Noah George says not all properties in a given suburb will make a good investment or have similar capital growth. Even if you never intend to sell it, for your property to appreciate in value strongly it will need to appeal to a wide range of owner-occupiers who make up the vast majority of buyers. That’s why I suggest you avoid studios, student accommodation, holiday accommodation, and serviced apartments. When a valuer assesses your property they will want to see it have broad market appeal.

Demographics holds the key

Long-term demographic trends (where and how people want to live) will determine the type of property that will be in demand in the future. As our cities mature there will be more single and two people households meaning that secure medium-density apartments and townhouses will be in strong demand.

Surround yourself with a great team.

Successful investors surround themselves with a team of top advisors and know how to discern an advisor (who is independent) from a salesman. When some “advisors” took a commission of 10% or more, to place clients into failed companies like Westpoint and Storm Financial, there must be some concern about whether such payments colored their “advice.”