For generations, Australians have bought houses to secure their financial futures. Many of us own our home – just under 70% according to the 2010 Australian Bureau of Statistics census. Many don’t only invest in their own home, though. Approximately 20% of Australians live in housing owned by private landlords. Property investment is clearly a popular choice.
Residential property is a lot less volatile than the share market – which isn’t to say it doesn’t fluctuate. Overall, though, property prices – particularly in good suburbs – generally rise over the long term. This is an excellent guard against inflation, and a good reason to choose property over bonds or bank accounts. There are other bonuses with property investment. With a good investment property, a bank can help you buy the house, have tenants help you pay off the mortgage, earn income from the difference between the rent and the mortgage and gain equity in the long term as the house value increases. There are also tax benefits with property investing, and subsidies are available for some investments. For example, many investors are making use of the National Rental Affordability Scheme (NRAS).
What should I look for?
Those who do invest in residential homes should research and select their properties carefully. Investors should always look for structurally sound buildings in areas where there will be good long-term growth. A well-performing area will resoundingly outstrip an under-performing neighbouring area over a 10, 20 or 30 year period because of the difference in compounding growth.
Is property always the best choice?
Property investment is not for everyone, however. Property investment works best over the long term so those close to retirement should possibly consider other investment options.
What should I do next?
Getting advice from a business such as Majestic Property Investment is a good place to start. We can help with strategic planning, selecting a property and give advice about finance and incentives. Contact us at [email protected], follow us on Facebook at www.facebook.com/pages/Majestic-Property-Investment-Invest-with-Confidence or give us a call on 1300 301 422 if you’d like to know more.