Firstly you need to define your goals. Do you want to: retire richer? Retire earlier? Supplement your income? Supplement your superannuation? Diversify your investments to spread risk? Give up your day job? Buying the right type of property in the .....
There are many good reasons to invest in property. Here are a few examples: Capital growth, rental income, hedge against inflation, tax benefits, a greater degree of control, lower volatility and high demand.
In a word: Now! Property is not a phenomenon of the last few years; it has been a secure investment for quite a considerable period. It will remain so as demand continues to rise. Building wealth is about getting compound growth and to get compound growth you need to stay within one market sector for at least a full cycle. Some advisers suggest a minimum of seven to ten years. Others suggest a range of 10 to 20 years to gain the maximum advantage of the long term cycle. All agree that property is not a get rich quick investment. It repays patience, and it rewards good preparation and careful management.
This is one of the main questions on any borrower’s mind and in many cases it is one of the fundamental steps in developing a strategy development. Everyone's situation is different and different banks have different internal calculations. It is not possible to be specific because there are too many variables, so part of our discussion with you will involve establishing your borrowing capacity based on your personal circumstances and taking into account the various banks and their products.
To encourage the private sector to invest in property for rental, governments have made available extremely viable tax incentives for the investor. It is through these available tax incentives that investors are able to purchase property at very little cost to themselves and in many cases at virtually no cost to themselves.
In many instances you can borrow the deposit for a property. For instance, we can work out a way for you to borrow the deposit for your own home, or for an investment property. For example you can borrow against value accumulated in your home (also called "equity").
While the decision to buy a family home is usually based on emotion, buying an investment property should be based on a logical and calculated process. Investors have to remember that purchasing an investment property is very much a business decision.
Capital growth is the money you make as the value of your property appreciates. While there's no guarantee your property will gain in value, historically property has experienced steady growth. According to many investment analysts and commentators, the long term growth in the value of residential property has been better than shares, commercial property, or bonds, cash or fixed term investments. Residential property is also much less volatile than the stock market. That makes it easier to live with for many people.
Many investors assume it is not worth getting a depreciation report completed on older properties. While it is true that newer properties contain more deductions than older properties, it is always worth getting some advice about the depreciation potential of an older property
Once you have bought your investment property, you will want to manage it to maximize your return and protect the value of your asset for the future. Looking after a property takes time and expertise if it is to be done properly.