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Investing in cash-flowing real estate in Brockville is obviously a benefit for any home owner or investor, expecially if that Brockville property is held by the investor for a long period of time. Every investment property in the City of Brockville has three income streams: cash flow, mortgage pay down and the appreciation in value from owning a home in Brockville.
Cash Flow: Rents collected from your Brockville property, minus expenses equals the cash flow. A modest cash flow of only $250.00 per month equals outs to an earning potential of $30,000.00 in ten years! (This is not including any rental increases)
Mortgage Pay Down: While you're holding the property, the mortgage is slowly getting paid down by your tenant. When you sell the property the difference from the original mortgage held on the property to the amount you sell the home for is the equity you gained. There's no easier way to gain equity from homeownship than by having someone else pay your mortgage for you. An example of this, let’s use a $300,000 purchase price with a 20 per cent down payment, a three per cent interest rate, a 25-year amortization and a mortgage of $240,000. In 10 years, the mortgage amount would be $206,008, a difference of $33,992.
Appreciation of the property: The third stream of income and usually the largest increase to an investor that buys property in Brockville, is the appreciation of the home. Real property appreciates over time. If you buy a home in Brockville for $300,000, lets assume that Brockville Real Estate will appreciat at a modest amount of 4% per year in 10 years the home you purchased in Brockville is now worth $426,990. Congratulations, you have just earned $126,990 in equity from the purchase of your Brockville Real Estate.
When all three of these income streams are added together, the investor would have a financial gain of $190,982. Not bad for a 20 per cent down payment of $60,000. Actually, when you calculate the return on investment of the actual money invested (which is only the down payment of $60,000), that is a 318 per cent, or 31.8 per cent per year, return on your money. If you would like more information on home ownership or houses for sale in Brockville, please call MINCOM Island City Realty Inc. at 613 498 2222 Brockville's leader in Full Service Minimum Commission Real Estate Sale.