In real estate, negative gearing is when the cost of buying and maintaining an investment property is higher than the income you gain from it. With this loss, it is then possible to offset the income you earn thereby allowing you to pay less tax on the property. For a rental property, for example, negative gearing occurs if the rental income is less than the interest on your loan and the …
What is Equity?
Many people are aware of their home equity but do not understand very well how it is calculated and its other uses. Basically, equity is the difference between a property’s current market value and the outstanding balance of any debt held against it. It is an asset from a homeowner’s point of view and it can increase over time as the property value rises and the loan balance is paid off. Only when …
What is Passive vs Active investing?
Investing in real estate is one effective way of building wealth and establishing a property portfolio moving into the future. There are two basic types – active and passive. Regardless of the type of property investing you are doing, each method requires time, knowledge and skills in order to reach your goals and maintain a stable real estate portfolio. Active Investing There are property …
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