Real Estate or a website, which is a better investment?

For many, the purchase of a property is one of the best forms of investments for your future, which I don’t disagree with, however there is another investment strategy that most financial advisors won’t tell you about, and creating assets online.

While property is always a good option, there are also a number of downsides, for instance the majority of your investment is tied up, so if you want an extra few thousand a month to play with, accessing it is not always an easy option.

The other issue with a property, such as a home is that while the long term return is good when you look at the figures, there are also a lot of expenses along the way.

For example, an average property purchased at around $500,000 may increase in value $250,000 over 5 years.

$50,000 a year is not bad, however depending on how much finance you required and the interest rates at the time, a good portion of this may be lost in repayments during the loan period, then take into consideration the fees and charges from the bank, tax, and then the costs to move into a home, not to mention any ongoing rates, body corporate, insurance, pest control, gardening, general maintenance, etc, etc, and you’ll find you lose a good chunk through expenses. Overall, when you add it all up as well as payout the loan, the actual income generated isn’t as great as it sounds.

Many potential investors jump on the property band wagon as a safe investment, however there are a number of other very profitable options that are available to just about anyone, and done correctly can be safer than houses, such as the internet.

After the purchase of my own home I looked at other options to get readily accessible cash faster than a home might, and as a web developer I turned to affiliate marketing, which is basically selling other company’s products online and earn between 6 – 65% in income from doing so.

This was my initial game plan which worked for me, and one your financial advisor probably won’t tell you about…

Invest $20,000 in seven websites which would cost approximately $1850 to develop each, with allowance for a small search engine optimisation budget, which luckily I taught myself to manage, and then generate income from the sites.

He was a bit doubtful until I explained how affiliate marketing works, and he agreed it could work.

The sites took 2 months to develop, so no income the first three months, and then into the fourth month the income started to trickle in by selling holiday accommodation for larger tourism networks. By the end of 12 months I could generate just under $9,000 per month for the most successful website, and $800 a month for the least successful site, with the majority of the sites easy to maintain with no external costs apart from a few hundred a year hosting.

 

So the $20,000 one off investment would generate 5 times the outlay in the first 12 months, with potential to keep growing as the popularity of the sites grow.

Each month the earnings are paid out to your bank account, where you obviously still pay tax on, but it’s money you didn’t really have to work too hard to earn once you have the sites created. I averaged 3 hours a week on promoting them online and building them up.

And this was just the start for me.

Websites these days can be easily duplicated to turn those seven websites into 14 websites, and so on, to essentially generate a much higher return than the average property might, with very little expense associated with it, and just a minimal maintenance, which the average person can do with a little training.

Through methods such as social media, it is easier than ever before to market and promote your website at little or no financial expense.

There is a lot of talk at the moment in the media about the concerns that kids these days will not be able to afford to own a home, but is that a problem or a blessing, when there are potentially greater investment opportunities out there for them to start with.

If they can scrape together a couple of thousand dollars and get into affiliate marketing they may well just have a good chunk of cash available in a year or so to buy that dream home after all, maybe even pay it off in a couple of years.

 

The new real estate is online.

 

Article by Chris Bourke

Chris is a website developer and affiliate marketing strategist, with multiple successful online business ventures, and over 20 years in design and web.

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