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Investment: Capital gains versus rental income?

ByJames Brown

If you're interested in becoming an investor in Burpengary real estate, understanding the various terms and phrases you're likely to come across will help to make the process much easier in the long run. 

However, a key thing to wrap your head around is the difference between capital gains and rental income. These are the two basic types of return you're likely to see on your investment portfolio, and knowing what each one is can be a useful tidbit of information to have. 

Capital Gains

One type of income you could potentially earn from your investment Burpengary home is capital gains. As you hold onto your property – alongside the strengthening local economy – it could see an increase in value on what you initially paid for the home. 

When you decide to sell the real estate, the capital gain earned is the difference between what you sell the home for compared to what it cost you originally. 

Rental Income

Earning rent from tenants you choose to live in your home is the second type of income you can receive from an investment property. Naturally, this is more regular than capital gains and can be used to pay off the mortgage owing on your home – effectively letting the property pay for itself! 

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