Equity and cash are really the same animal, but the cash is liquid while equity holds the potential to become so. We just have to look at developing financial strategies to convert it.tho I suspect alot may not have understood what you were getting at, particularly on a forum that is predominantly buy and hold. Resi IPs tend to be take cash rather than return it. So you need to either value add or LOE in order to retrieve your upfront equity.
For example when I use equity to grow my asset base I don't have a requirement for cash because I am borrowing out of my asset growth.
Maybe I should have asked the question. "When do I get my equity back?"
The funny thing about the whole LOE debate is that with my property strategy, I actually live off the rents and my increasing equity pays for the growth and maintenance of my asset base. The balancing of that strategy is critical to its success. The thing that a lot of folks who are only a little way down this track find tricky to understand is: the fact that our lifestyle costs X, and when our asset's equity growth is four or five times that X figure then it is a whole lot easier to keep the machine turning, than when I was back in the "I work for money" mode.
I need cash to keep the machine running but that cash is there as equity in the leverage farm and the crop matures as the ecomonic seasons allow.
Cheers
Simon
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