Ajay Ahuja on Property Investment and Risks

I got an email in response to my last article about:

Is Property Investment Really That Risky?

Stating that I forgot negative equity.  So does it matter if your property falls in to negative equity.  Definitely NOT.

The value of a property that you hold bears no reference to the monthly cashflow you get from it when you run it properly.

If you buy a property for 100,000 GBP and it chucks out 1,000 GBPprofit every month, does it really matter if this property you have just bought fall to 50,000 GBP. No.

If prices to drop to 50,000 GBP then you should do everything in your powers to buy every property in the street at this price as you will become very rich.

Property is all about producing a stable long term flow of income with very little risk.  If anyone tells you its about capital growth then they do not fully understand the nature of property.

It’s the long term flow of income that determines the value of an investment property.  If the flow of income look to become more certain or rise in value then capital gains will be experienced in the medium to long term.

Anyway, good luck with your property purchases.  For more help visit my advice page.