I'm excited to share a new page with you titled, "PID's Mortgages".
First, I love the picture to the left because I think it can be interpreted two ways:
1) Your mortgage is literally about to crush you, like an ant.
Or, 2) You are using mortgage debt to make a lot of money and are now Superman proudly showing it off by lifting an entire house, made out of money, over your head.
On this page I will show you why I believe having rental properties helps you achieve the second interpretation. Specifically, I will highlight the major benefits of buy-and-hold rental property real estate, the current market value of Passive Income Dude's rental properties, as well as the current mortgage values against them.
To start, one of the biggest benefits of real estate is being able to lock in fixed rate debt for a very long period of time. Primarily because of the following four key reasons:
1) Inflation slowly erodes your mortgage debt for you. Without you doing anything. This is the hidden wealth creator of real estate - borrowing whole, real dollars TODAY that become very cheap to repay 20 or 30 years from now. Do not miss this powerful wealth creator.
2) You can highly lever your initial investment, resulting in massive gains over time.
3) Mortgage debt, or as I like to call it, cheap capital for you, is very, very inexpensive to obtain and to lock for decades.
4) Finally, once you 'outsource' your mortgage payment to your tenants, you receive the three benefits listed above and literally have a gold mine investment on your hands that gets stronger and stronger each month.
Let me give you an example of its strength increasing, passively each month: my 'equity paydown' total, just to show one of the benefits of real estate, has now increased more than $20 per month since the start of this year, 2016. Without doing anything. To be clear: what I am saying is that every month, literally forever, my equity paydown will be $20 more than it was at the start of this year, without me doing anything, and it will only get bigger and better, each month. Forever. Without doing anything. Very exciting, and you can follow the same strategy and benefit from it as well!
All of that said, listed below is the current status of my mortgages and home values, etc., in detail:
Note that the 'monthly equity paydown' and 'debt reduced' columns listed above are PER MONTH. EVERY MONTH my mortgage debt is lowered by over $1200, with zero dollars paid for by me - all paid for by my tenants. What a benefit!
Check out the full page here to see PID's Mortgages in even greater detail. I'm interested to know what you, as fellow smart investors think? Please comment below!
Thanks for reading,
Passive Income Dude
I'm in the process of buying a rental property.ReplyDelete
I think it is one of the surest ways to make passive income. It's not truly passive as there is work involved but over the long term it seems to be a real winner.
Only problem is in Canada you need 20% down and houses are not cheap.
Keep up the good work