5
Why investing in property may be the
answer
Australia currently faces a chronic housing
shortage which, coupled with a rapidly
expanding population (through natural
increase and immigration), has pushed
rental vacancy rates to historic lows and put
upward pressure on rents. There are simply not
enough houses to go around.
An investment plan is one that works towards
building your wealth and securing your
financial freedom. For some, the future may
seem a long way off, but the time to act is
now because the future waits for no one. The
housing market is generally a seven to ten
year cycle: there are always highs, lows and
steady patches.
The decisions you make today will determine
the lifestyle choices you have in the future.
The following factors should be taken into
consideration when purchasing property as an
investment:
• the likely return - yield and capital
growth,
• buying and selling costs,
• cost to borrow money, ie interest rates,
and
• how attractive the property will be for
likely tenants or future buyers.
Do your homework
First you need to work out how much you can
borrow. This is where our services will really
help you. Make sure you have an accurate
and detailed budget that takes into account
all expenses associated with purchasing a
property including stamp duty, council rates
and other fees.
Research the area’s average rental
yields, historical price growth and future
expectations. Talk to your local council about
future infrastructure and additional planned
services.
Ensure you go to many open inspections
and do your research on the internet before
purchasing to ensure you have a good
indication on property prices in your desired
location.
Invest the time to fully understand the
market
- it could make a big difference to
future investment returns.
A mortgage is a big commitment and you
may have to make changes to your regular
spending practices if you are to meet your
repayments with ease. Include water and
council rates and items such as insurances and
maintenance in your budget planning.
PURCHASING YOUR INVESTMENT PROPERTY
Ask us for
a copy of
our budget
organiser
if you don’t
already
have one.
Ask us for a
copy of our
property
checklist to
help with
ideas before
you start
inspecting
properties.
BUDGET
ORGANISER
Item
Weekly
Fornightly
Monthly
AnnualTotal
Salaryorwages (after tax)
$
$
$
$
Pension/governmentallowance
$
$
$
$
Child support/maintenance
$
$
$
$
Investment income
$
$
$
$
Other income
$
$
$
$
Total income:
$
$
$
$
Debt repayments
Mortgage/rent
$
$
$
$
Car loan
$
$
$
$
Personal loan
$
$
$
$
Creditand storecards
$
$
$
$
Taxeson investments
$
$
$
$
Other
$
$
$
$
Householdexpenses
Rates (land/water)
$
$
$
$
Bodycorporate fees
$
$
$
$
Repairsandmaintenance
$
$
$
$
Gardening/lawnmowing
$
$
$
$
Cleaning (house/pool)
$
$
$
$
Utilities (gas/electricityetc)
$
$
$
$
Householdpurchases
$
$
$
$
Groceries
$
$
$
$
Telephone -fixed
$
$
$
$
Telephone -mobile
$
$
$
$
Internetaccess/payTV
$
$
$
$
Motorvehicle/transport
Fuel
$
$
$
$
Repairs
$
$
$
$
Lease
$
$
$
$
Registration
$
$
$
$
Parking
$
$
$
$
Fares/public transport
$
$
$
$
Educationexpenses
HECS
$
$
$
$
School feesandexpenses
$
$
$
$
TAFE fees
$
$
$
$
Tuition
$
$
$
$
INCOME
EXPENSES
$
Dateof inspection
Auction PrivateTreaty
House Unit Duplex
Address
Land size sqm
Internal sqm
REALESTATEAGENT’SDETAILS
Mobile
Email
FUTUREEXTENSIONPOTENTIAL
THEEXTERIOROFTHEPROPERTY
POOL /SPA
PATIO /VERANDA
THE INTERIOROFTHEPROPERTY
THELIVINGROOM
Living1
Living2
Living1
Living2
THEKITCHEN
Propertychecklist
