Posted on December 6, 2009 - by Alvin

Enjoy Cash Flow and Capital Gain from Property

Photo by woodleywonderworks

After pondering on what Robert Kiyosaki emphasized on investing for cash flow, I have been thinking what would be the best income generating asset to own. Besides property, I really have no idea what else. In this post, I shall make the justifications for property investment.

Cash flow in the form of rent

The cash flow from property comes in the form of rent. The advantage is that the rental charges collected can be used to offset your mortgage monthly installment. In fact, the rent should more than cover your mortgage payment in order to make profits. If you can keep your property tenancy till the end of your loan, you own the property for free! If you can do it for one property, you can replicate the success in more properties without you having to pay for mortgage. This is how the rich gets richer!

Hard assets are good in inflationary period

In high inflationary period, money will lose value very fast. Hence, people will flock for hard assets like commodities. People who hold on to properties benefit too because the value of their house will skyrocket. If the gurus’ prediction of the coming high inflationary period is correct, owning hard assets should at least protect your net worth as the value of your assets should rise in tandem with the rate of inflation. If you think that the US dollar collapsing is none of Singapore’s problem, you may want to think twice. Monetary of Singapore has just announced they will use measures to make sure SGD/USD will not go below 1.38. Hence, if USD devalues and SGD has to maintain that exchange rate, SGD will have to devalue as well. Read more…

Related posts:

1. Investing for Cash Flow
2. New measures to ensure a stable and sustainable property market might cool interest in property stocks for a while…
3. Is Your Company Hoarding Too Much Cash For You? – Part 4