The 5 keys to why property investment will give you freedom

The building wealth overview from Clevercashflow

Alexander Teckkam is editor of helping others achieve financial freedom. Alex achieved financial freedom at the age of 27 years old.

“90% of all millionaires become so through owning real estate” - Andrew Carnegie

Property is a great investment if you are seeking freedom. What I mean by freedom is doing what you want, when you want with whom you want. If you are worried about losing your job or if you are worried about your family's long term security, a substantial property portfolio can help you ease these worries. Property investment done right  can give you a great source of passive income, money that comes into your bank account every month. This can supplement your income or can even allow you to retire early. There are 5 key reasons to why I think property investment can lead to a life of freedom:

Key 1 - Passive income

When a property is rented out it produces rental income. If the property is chosen correctly this will produce more money than all the costs leading to a positive cash flow. This will give you supplementary income which can contribute to your lifestyle or your savings pot.

Key 2 - Capital appreciation

Since the 1950’s UK property prices on average have doubled between every 4-14 year period averaging every 10 years. The simple reason is demand and supply. We are currently not building enough houses to satisfy our growing demand. Historical appreciation cannot predict future growth but when prices have been increasing for so long it is a struggle seeing that change even after the 2008 bust.

Key 3 - Inflation

The UK has averaged a 2.62% inflation rate since 1989. What this means is that goods have been getting more expensive over time. Why is that good for property? If your property has been bought with a mortgage, your mortgage borrowing in real terms will be reducing in size every year.

Key 4 - Adding Value

If a property is in a bad condition or in an auction it is possible to add value to the property or even buy it below market value (BMV). This is not the case with other forms of investing such as peer to peer lending or stocks and shares investing.

Key 5 - Return on Investment

Investing in property can give substantial returns on investment of 30% or more if investing correctly. This is much higher than other forms of investment. This can get you to financial freedom much faster with a smaller savings pot.
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