Q62: How much profit can you make from real estate investment? ② Capital Gains
Let me start with the conclusion. Capital gains refer to the profit obtained when you sell a property for significantly more than its purchase price, either by increasing its value or by timing the market correctly. If income gains are 'wealth built up over time,' then capital gains are 'wealth that changes the rules of the game of life in one fell swoop.'
1. Why do capital gains cause such a drastic change in assets?
The impact of overwhelming amounts: While you might save up millions of yen bit by bit through monthly rental income, if your exit strategy (sale) hits the mark, you can obtain tens of millions, or even hundreds of millions of yen in cash in a single transaction.
A powerful springboard for the next investment: The massive amount of cash you obtain transforms into an 'overwhelming down payment' for purchasing your next, larger property. It is precisely because of this springboard that asset holders can leap up to a scale of tens of billions of yen at once.
2. The '3 conditions' for generating capital gains
① Securing an overwhelming 'location (demand)': Properties in places where everyone wants to live are less likely to lose asset value over time, and there are always buyers.
② Sound 'depreciation and loan reduction': As the loan (principal) to the bank decreases over the years, the proportion of net cash remaining in your hands at the time of sale increases.
③ 'Exit design' with an eye on the income capitalization approach: The deciding factor is whether you are managing the property by working backward from the buyer's perspective: 'How much would the next investor be willing to pay for this property in the future?'
3. [Perspective of new RC real estate] Why is the sales profit of new RC buildings in the 23 wards exceptional?
Investing in a whole new RC building in the 23 wards is the 'ultimate dual-wielding' strategy, where you can earn solid profits through monthly income gains while also aiming for massive capital gains at the end.
The 'indelible value' of land in the 23 wards: Land in the 23 wards is the most scarce asset in Japan and is targeted by wealthy individuals from all over the world. Even if the building gets old, the 'value of the land' supports it, so the risk of a crash is extremely low.
The premium from 'new' to 'recently built': An RC apartment building that you built as new and have managed and maintained properly will be sought after in the market at an overwhelmingly high price as a 'popular, well-maintained, recently built RC building' even after several years.
A warp device to becoming a '10 billion yen asset holder': Operate several new RC buildings in the 23 wards and collect sales profits (capital gains) at the appropriate timing. The explosive power of this single strike becomes the strongest engine to fundamentally rewrite the digits of your net worth.
Conclusion: Investment without an eye on the exit is a voyage without a nautical chart
From the moment you buy a property, are you already looking at the exit (when, to whom, and for how much to sell)? That is the decisive difference between an amateur and a professional.
Build the strongest fortress of new RC buildings in the 23 wards, and finally, climb the ladder of wealth with overwhelming capital gains.
■ August Study Session [Basics of Real Estate Investment x AI Agents]
