Leaving a Legacy With Real Estate

8

Piggy BankReal estate is a fantastic long term investment which makes it suitable to include as part of your family legacy. Have you ever considered what you would like to pass along to the next generation?

In my case, Old MacDonald had a farm and it has been passed along from generation to generation. Passing along income property is a great way to leave a legacy and keep wealth within the family.

Long Term Wealth

Long ago Old MacDonald purchased a farm and started to work that farm – it was the family business. Over the years, the mortgage was paid, and eventually that farm was owned free and clear. Years later it has been passed from one generation to the next. Now, not having the burden of a mortgage makes running the family farm a whole lot easier.

This is a real life example of the long term power of real estate. The property was an investment, one that made the family business possible. While this is a little different than the traditional buy and hold real estate, the end result is the same – the property is owned free and clear. Buy a property today, pay the mortgage for 25-35 years, and at the end of the day you’ll own the entire thing outright. If you can find positive cash flow properties, your tenants essentially buy the property for you over the amortization period of your loan. To me, this is the real beauty of real estate investing.

Taking It Slow

Even if you don’t want to be a full time real estate investor, it is within anyone’s ability to buy rental property. What if your parents or grandparents had bought just 3 rental properties in their lifetime? What if they purchased one every 10 years of their working lives and later passed that portfolio on to your generation. Even with a slow and steady stream of just 3 investments, that small portfolio would create a nice legacy and base of wealth for the family.

If those 3 properties were paid off, they would provide great cash flow to support a retiree, or offer substantial equity for a cash-out refinance to start another business or buy more property.

Passing It Along

Even a little real estate can go a long way in building a family legacy. As a sustainable long term asset, it makes a great base for building generational wealth. So, what will you add to the family purse for the next generation?

Creative Commons LicensePhoto: alancleaver_2000

About Author

Andrew is a Canadian real estate investor and analyst who works with Joint Venture partners to create long-term wealth. With a focus on buying and holding positive cash flow properties in Canada's Technology Triangle, Andrew makes the benefits of real estate investment available to those who lack the time or expertise to buy and manage property themselves.

8 Comments

  1. Pingback: Leaving a Legacy With Real Estate

  2. Great post!! My Grandma and Grandpa had a single building that they held for 30 years. Paid for their retirement years. He sold it via VTB to my Aunt and Cousins. They then made payments that continued to pay for their retirement and now that Grandpa is gone, it still pays for Grandma’s costs. Pretty powerful example and legacy.

    More than the actual asset itself I think the example my Grandpa and Grandma set for me has changed my life and that of my parents. My Dad got into commercial real estate in his late 30’s and it’s going to be what funds his retirement too.

    • Hi Julie, this is another great real life example of real estate creating long term wealth. Today we can’t rely on our employer to take care of our retirement so we have to start looking at other options. Investing in real estate is a great way to take matters into your own hands and enable your own retirement.

  3. Great topic Andrew…This has been my plan for over thirty years. I’ve been side tracked a time or two over the years but by and large I’m on track to do exactly this. Pass on a legacy of solid properties now operated for me by competent property managers. These properties give me a nice retirement income and will continue to do so long after I’m gone. To0 bad more folks don”t take a longer term approach to property ownership. I started at 22 years old. I have always been a buy and hold investor. I hate to sell…I have a few times, my portfolio jumps nicely each time by reinvesting the sale proceeds and levering up again. I attend a couple REIA meetings each month always nice to see younger people plugging away…I wish some of these folks could see the value in a nice duplex or two. Everyone wants to rehab flip wholesale…That’s fine I have done all those things. Do yourself a huge favor…Take Andrew’s advice, start tucking a property or two aside for the long haul. My properties allowed me to quit my job 10 years ago. I now spend my day working my small farm, playing with my old cars and driving by my properties once in a while just to keep the managers on there toes…I take great pride in the ownership of these properties…It is hard to believe they all grew from that first little duplex…I always hoped it could work out this way…

    • Hi Dan, great to see another example of this strategy in action. I just got cheques for a Joint Venture on my last property and now have a bunch of cash sitting in my account. It’s tempting to go buy a BMW, but I’d rather purchase another property and grow the portfolio so it can make my BMW payments for me. Hopefully this delayed gratification will make a big difference at the end of the day.

Leave A Reply

Pair a profile with your post!

Create a Free Account

Or,


Log In Here

css.php