Use Equity To Create Cashflow in 4 Simple Steps!

by | Aug 20, 2021 | Blog, Invest in Real Estate, Property Investment

Equity is an interesting topic when it comes to real estate. Smart property investors know that equity can play a key part in creating passive income that accumulates over time, allowing us to eventually work less and ultimately do more of what we love. 

But in order to be able to use equity to create passive income, there are some important steps property investors need to take right at the beginning of their journey.


As property investors we want our acquisition period, the time when we are buying our properties and building up our portfolios, to be quick. The faster we buy our properties, the sooner we can start making enough passive income to achieve our goals – whether that’s a new car every year, a shorter working week or early retirement.

But, simply because we want our buying period to be fast, that’s not a reason to buy any and every property we see. Quality is king when buying real estate.

And, it’s not just quality of the physical building or structure. It’s also quality of location, and quality of the kind of tenants you’ll attract and rely on for regular rent increases.

Making sure your properties will start to gain equity i.e. increase in capital value, depends on the quality of:

  • what you buy
  • where you buy 
  • who you rent to



Knowing that your properties have equity and watching as they increase in capital growth, is an amazing feeling as a property investor. 

But, if the way you have structured your loans means you can’t access, or can’t afford to access, that cash, it’s a vanity project. Nice to look at, but a bit useless.

Equity is only going to benefit you, in terms of cashflow, if you can access it.

If you don’t understand finances and loan structure, and need some help and advice, seek out the experts and get some coaching to ensure you’re starting your investor journey in the right way from the beginning.



One of Positive Real Estate’s mantras – buy well, never sell.

If you think the only way you can access equity in your property is by selling it, not only are you wrong, you’re also about to lose a lot of that value to the selling agent and the government in taxes. Whatever you have left will go into a savings account, where you’ll earn a pitiful amount in interest. Selling to access equity makes no sense.

Property investors know they need to retain their real estate for up to 20 years to allow that property time and space to go through the cycles of the market and reach its full potential.


Real estate is a numbers game. From the start we have to know how much money we need to create the life we want to live. Then we calculate how many properties we’ll need and how much rent we’ll earn, to create that income.

Equity is the same. The value of your property has to be high enough (we recommend no lower than $3 million) for equity to be able to act as cashflow. Too low and it’s not appropriate.

Also, taking too much equity value (more than 2 per cent) out of your properties is going to leave you vulnerable. 

Seek out some expert coaching and advice from people who know their numbers and can help make equity act as cash flow for you.


Talk to the experts at Positive Real Estate about where to begin. Our team have decades of experience, about how to borrow, buy and use equity in the current market. 

Join our free property investing seminar.

Getting started now means you’ll have the ability to create the future exactly how you envision it to be. 

Spots are limited so ensure you book now so you don’t miss out. 



Recent Articles

The Money Management Skills You Need For Real Estate In 2022

Real estate is the perfect asset structure for wealth building, but it has to be done right – and that means having solid money management skills to back you as you make these major financial decisions. Some of these skills may seem obvious – like having a budget – but you’d be surprised how many young investors didn’t get to build this foundation of knowledge through their school or home life.

10 Property Investment Tax Mistakes To Avoid

Tax isn’t often one of those conversations that give investors the warm fuzzies, especially when we’re talking about the 10 property investment tax mistakes to avoid! But it’s important that property investors reframe their thoughts around tax. Owning real estate can actually be incredibly tax effective – in fact some might say tax is a secret weapon for property investing.

Should I Buy An Investment Property Or Home First?

Owning property has always been part of the great Australian dream. A lot of people want a place to call their own, with stone benchtops, the latest appliances and a great entertaining deck out back. So, when interest rates hit a record low in the last couple of years and it suddenly started to cost the same to own as it does to rent, why wouldn’t you have just bit the bullet and bought your own home?

Guide To Investing In Positive Cash Flow Property

If you want to become a superstar property investor and be on the path to financial freedom, then you’re going to need this guide to investing in positive cash flow properties! Investors that follow a positive cash flow strategy understand that living off passive income is the key to an early retirement – and the only way to do that is to make our money work for us, not against us.