One of the optimal and safe ways to create generational wealth is by creating passive income by investing in fractional properties, start generating income streams for your family.
Let’s first start with the definition of generational wealth before we talk about how to create it through real estate. It is very important that you understand the definition from the outset.
When we talk about generational wealth we refer to assets that are passed down from generation to generation. These assets can be a business, investments or real estate! Basically it is the heritage that you build little by little to later inherit it to your children and that later your children inherit it to their children subsequently.
It is vital that you can glimpse the importance of generating wealth in the long term. A very clear, strong and consistent example of generational wealth is the case of the Hilton family. It all started with Conrad Hilton, who bought a 40-room hotel in World War II and that’s how he started building his own empire.
In 1954 he created the first international hotel chain in the world under the name of Hilton Hotels and by 1979 his sons took over, it was until 2007 that Blackstone bought the business for 26,000 million USD. And while the Hilton family does not currently own the hotel chain, the wealth this family business generated will continue to benefit the family for years to come.
Creating generational wealth provides families with protection and economic stability and in today’s article we tell you how you can start building this wealth yourself through real estate.
How is generational wealth built?
Investing in real estate is a great asset that works very well to build wealth, because it offers investors multiple incentives, such as cash flow, leverage, tax advantages and most importantly… appreciation, which helps investors to scale their wealth over time
“Real estate has great appreciation potential. As such, it is an ideal asset to transfer to younger family members to eliminate any potential future appreciation of the owner’s estate for federal estate tax purposes.”
Jere Doyle
Senior Estate Planning Strategist,
BNY Mellon Wealth Management
One of the best options for investing in real estate is through fractional ownership. In this model, the costs of an asset are divided, such as a luxury vacation home in Acapulco, and you only pay for the portion you plan to use, which for a vacation home would be equivalent to the number of weeks per year the property will be occupied. Once you complete the paperwork, that part of said property becomes yours to enjoy.
In general, real estate fluctuates from year to year; however, vacation goods have a great opportunity to grow in value. This is thanks to the popular areas and cities in which a vacation home can be located, there is a range of appreciation that becomes an important benefit in the long term.
The value of a property can rise by 10% from year to year, of course this will depend on the economic conditions of each state, but for example: in Mexico there have been annual increases between 15% and 20% in tourist areas in the last year.
Therefore, investing in fractional vacation properties is the best option, because you have the ability to invest in assets that will appreciate over time, you will not have complications and you will obtain passive income. And in case you need extra cash, you can easily sell your part of the property without having to go through annoying red tape.
All this is possible with Ancana, the marketplace to buy fully managed vacation homes through a fractional scheme. Fractional ownership allows you to own a home that might otherwise be out of your price range if you were looking to own the entire property. This means that you get the luxury home you want in the most desirable destinations at a more affordable price.
We find the best vacation homes, handle the legal process of dividing the house into fractions, find and vet co-owners, and manage the property. Once all the shares are sold, Ancana has no ownership interest in the house.
For some people owning a vacation home can be a burden. However, at Ancana we take care of all the inconveniences of being an owner, so that you can focus on what is most important: relaxing and enjoying your home with your family and friends. Ancana takes care of the upkeep of the house, including repairs, housekeeping, and gardening.
In summary…
Building generational wealth now is the way to ensure and protect the family economy for future generations. It will help lead your family to a financially secure life and if you want to accumulate wealth start by investing in fractional properties.
If you would like to review the fractional properties available visit our page ancana.co to see more information and start building your generational wealth.
Owning a vacation home has never been this easy.