One of the great Australian dreams is owning a home.
Despite all the talk of property investment in the media, only 8.7% of Australians own an investment property according to the Australian Taxation Office.
Most people don’t know where to start with property investment and never follow through. Here are some tips and ideas on how you can get started with property investment; and consider investing at Exford Waters!
Get your finances in order
Figuring out your income and outgoings is the first step toward finding out how much you have available to invest. Assumptions about your finances are rarely accurate – get out your calculator and do the maths; you may have more money to invest than you think.
Define your goals for the investment
Investing in property must have an end goal. What do you want your property investment to achieve? Do you just want a passive income to pay your current mortgage? Or replace your work income with property revenue for retirement?
Figure out this goal and create a plan around it. It may be a 5, 10, or even 20-year plan. Have milestones you want to hit and break them down into yearly or monthly goals. It makes your actions more manageable over time.
Do you have equity?
When it comes to financing your investment, you may be able to tap into the equity in your existing residential property. This can act as a deposit for an investment property which can lower the amount you need to borrow from a bank or lender. This can also help determine your budget for the purchase.
Begin budgeting and looking at finance options
With a new investment property to take care of, you need to budget again to take care of repayments. You should find out your borrowing power and figure out how you’ll pay for your investment each month, regardless of income, tax breaks, and so on.
Plan your purchase
Don’t be swayed by trendy suburbs and big numbers; plan your purchase according to your goals and your budget. Find out how you can leverage a property for the best growth or income. Get proper appraisals, shortlist properties, and be prepared to negotiate.
Tax and negative gearing
Do you know about Capital Gains Tax? What about negative gearing? Negative gearing and other benefits such as deductions on expenses and interest may be available to you. Speak to an accountant or financial professional to help reduce your tax.
Be in it for the long-haul
Property investment is not a “get rich quick” scheme, though it is a “become more financially independent over time” method. It can take years to see a real return; don’t get discouraged in the short-term. Picture yourself with a more comfortable retirement or that year long cruise around the Caribbean you’ve dreamed about!
Remember: always get advice from real estate and financial professionals before making any decisions about property investment.
The friendly team at Exford Waters is on hand to answer all your questions. Speak to our experienced team by calling 1800 777 800 or by visiting our sales office at 255-299 Exford Road, Weir Views.