Real estate
Real estate

Real Ways to Profit from Real Estate (Part 2)

Hello and welcome back! This is our second blog post about real ways to earn from a real estate investment. If you have not yet read the first seven basic ways, it may help if you visit Part 1 of this series first, then come back right here for more clever ideas and inspiration!


Hello and welcome back! This is our second blog post about real ways to earn from a real estate investment. If you have not yet read the first seven basic ways, it may help if you visit Part 1 of this series first, then come back right here for more clever ideas and inspiration!

Profit from full selling price using leverage

Let’s say you acquired a $100,000 property with just $20,000 down payment. If that same property appreciates a few years later and sells for $120,000, that means (1) you got your initial $20,000 back; (2) you also got your principal payments back; (3) plus the additional $20,000 profit from appreciation. That’s a whopping 100% profit, less the principal payments to your initial $80,000 mortgage of course. Nonetheless, the bigger your leverage is, the higher is your return.

Interest tax benefits

Depending on which country and state you live, you can often deduct the mortgage interest from the rental income, and create a tax-free profit. You may ask your local real estate accountant for advice, but once you know it, there’s no way stopping you from earning the same for all your investment properties in that location.

Tax benefits on improvements

This is a double home run right here. Properties need occasional improvements over time. While these are of course expenses, you can always view them as investments in two ways. First, when you spend on improvements, this adds more value to the property as it appreciates over time. Secondly, being an expense, you can always deduct the cost of improvements from your rental income.

Lump sum profit from refinancing

Let’s use that $100,000 property as an example once again. If you spend $5,000 of the rental income you got from tenants for really great renovation works like additional amenities, over a short period of time the property can be worth so much more, say $120,000.

Next, you can refinance to get that $20,000 value appreciation in real cash. That’s how you can get for yourself a fresh lump sum of $20,000 for down payment of your next rental property. Awesome, isn’t it?

Increase cash flow profit from refinancing

Say for example your monthly amortization for a rental property is $500. And your tenant is happily paying you $650 each month. You have a positive cash flow of $150 every month. Not bad. But there is a way to earn more, without increasing rent.

You can apply for refinancing from another bank with lower interest rates, which can lower your monthly amortization. With a new monthly amortization of $400 and rental income remains the same, you have increased your cash flow to $250 per month. Imagine what you could do with the extra $100!

So, if you are seriously considering investing in real estate, the strategies we shared in the previous blog post are more than enough to convince you that properties are a good investment. And these five more advanced ways to profit from properties right here are surely the icing on the cake! So what are you waiting for?

Real Estate, redefined

Whether you’re buying as an investment property, or just because you’d like somewhere new to live, let us here at Domobase make it easier for you. We connect you with only the very best Real Estate Agents and Landlords, meaning you’re only shown the very best properties that fit your requirements as closely as possible. How do we make it easy for you? By keeping it simple. All you need to do is download our app, fill in your details and link up your social media profile. within a few days, we’ll have up to three first-rate industry professionals get in touch with you. That’s all there is to it.


Jeff is a full-time family man by day and a multipotentialite by night. When not writing for Domobase, he's usually creating music, learning new skills, or working on his businesses till the wee hours of the morning.