Every investor in the world invests in real estate, believing that investing in real estate will lead them to financial freedom and wealth gains.
Real estate is an investment approach which guarantees high potential of producing various income streams for investors and property owners. Mr. Va Vireak, Century 21 Zillion Holding’s coach and Certified International Property Specialist (CIPS) highlights four ways in regards to how real estate inherently creates diverse income streams.
1. Real Estate Increasese in Value over time – capital gain
A great way to increase your income with real estate is to buy and hold properties, and sell them once the value is increased. “ During 2007 I bought a piece of land property in Saen Sok district at $14 per square metre at that time. The property skyrocketed to $300 per square metre, which translated into 22 times increase.” said Mr.Va Vireak.
2. Generating monthly or passive income
‘Buy and hold’ strategy is not the only option to double your income. Alternative way to boost your income is by leasing and renting your properties for monthly cash flow.
Robert Kiyosaki, the author of Rich Dad and Poor Dad, and whose book sold over 41 million copies, believes that investing in real estate for the purpose of creating passive income is the best way to reach financial freedom which a lot of rich people used to create their wealth gains.
3. Apply ‘Hybrid’ Strategy
Hybrid strategy allows investors to buy and sell for profits when the value increases or buy and renovate the properties then sell them at a higher price. Even better, investors can also invest in properties that generate monthly or passive income.
However, what kind of real estate investment you choose; both ways produce a different amount of profit. One can be higher than the other一 but either way promises a desirable income since the price of real estate rises between 10 to 15 percent each year. Whilst gross rental yield rate is between 6 to 8 percent per year – a relatively high rate in Asean property market.
4. Instead of renting, take advantage of your own property
If you have your own land or building located in a good area, consider using that property to open your own business. It saves you from expensive renting costs and cuts down on additional spending.
English text by Kem Sreyneth. It has been originally translated from Khmer edition.