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The "I" in IDEAL stands for Income. Your investment property should be generating
income
from
rents
received each month. Of course, there will be months where you may experience a vacancy, but for the most part your investment will be producing an income.
The D in IDEAL Stands for Depreciation. With investment real estate, you are able to utilize its depreciation for your own tax benefit. It's a non-cost accounting method to take into account the overall financial burden incurred through real estate investment.
The "E" in IDEAL is for Expenses Generally, all expenses incurred relating to the property are deductible when it comes to your investment property. The cost for utilities, the cost for insurance, the mortgage, and the interest and property taxes you pay.
The "A" in IDEAL is for Appreciation - Appreciation means the growth of value of the underlying investment. It's one of the main reasons that we invest in the first place, and it's a powerful way to grow your net worth.
The
"L"
in
IDEAL
stands
for
Leverage. This is when you are using a small amount of your money to control a much more expensive
asset.
You
are
essentially leveraging your down payment and gaining control of an asset that you would normally not be able to purchase without the loan itself.