I've just bought my first investment property a few months ago and I'm now trying to project what will happen in the future regarding income and also how to work out my property goals. My original thoughts were that I would like to buy 10 properties over 10 years and that would enable me to be financially free. I was hoping that would give me about $100,000 income per year, which I think would be sufficient.
I've just pulled out a pen and paper to do a quick projection and I'm wondering if anyone can let me know if I'm doing this right or not.
Currently my property is worth around $400,000 and lets say that I bought another property per year for the next 9 years at the same figure. I've calculated that if the properties were to rise by 5% each year consistently then the first one would now be worth approx $650,000 in the ten years, the second would be $620,000 and so on till the last one is worth $420,000.
This would be a capital growth of about $1,275,000 over all properties for the 10 years. Now assuming that my rental return was about 5% of the above figure I would have a cashflow of $63,750.
From the above demonstration it looks like I will be short of my goal of $100,000 per year passive income and therefore 10 properties is not going to be enough.
Can anyone let me know if I'm actually working out the future income correctly? I'd like to put a plan in place which will enable me to achieve the desired income and looking for some tips on how to go about this.
Thanks.
I've just pulled out a pen and paper to do a quick projection and I'm wondering if anyone can let me know if I'm doing this right or not.
Currently my property is worth around $400,000 and lets say that I bought another property per year for the next 9 years at the same figure. I've calculated that if the properties were to rise by 5% each year consistently then the first one would now be worth approx $650,000 in the ten years, the second would be $620,000 and so on till the last one is worth $420,000.
This would be a capital growth of about $1,275,000 over all properties for the 10 years. Now assuming that my rental return was about 5% of the above figure I would have a cashflow of $63,750.
From the above demonstration it looks like I will be short of my goal of $100,000 per year passive income and therefore 10 properties is not going to be enough.
Can anyone let me know if I'm actually working out the future income correctly? I'd like to put a plan in place which will enable me to achieve the desired income and looking for some tips on how to go about this.
Thanks.