Business and Management

What Is So Good About Positive Geared Property?

Passive income can be generated by positively geared properties. Because they produce more income than they spend on expenses, this is why they are so popular. 

If you invest in negatively geared properties then they COST you money every month to own. So you can quit your job and live off the income from these properties because you need the income from your job just to keep these properties. You may check out the various online sources to find the best negative vs positive gearing.

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Income Goes Up Over Time

Rent almost always goes up over time, but your one major expense, your mortgage repayment stays the same. This means that as rent goes up you are earning more money but your expenses aren't going up by a lot. 

So you can either have more money in your pocket every month or you can pay off the loan of the property quicker. This means that over time it gets easier and easier to pay for the property.

There Can Be Less Risk

There can be less risk when you invest in positively geared properties because you are earning income from day one. 

With negatively geared properties you lose money every month and you have to sell for a profit if you want to make that money back. However, if the property doesn't go up in value then you can lose a lot of money.

With positive cash flow properties, you make money from day one! This means even if your property doesn't go up in value you can still make money through your rental income.