Is Investing in Property a Good Idea?
There are lots of options when it comes to investing your hard-earned money, from shares and bonds to high-interest bank accounts and peer-to-peer lending schemes. Among the options, property remains a popular choice for seasoned investors and novices alike. So why do people choose time and time again to invest in the property market? We explore the benefits of investing in property and why it’s a good idea.
Investing in property is relatively simple when compared to other investment options that require specialised knowledge. For starters, many people have some general knowledge of the property market and the associated terminology. The strategies behind property investment success, such as positive gearing, capital growth and rental yield, are also quite simple to understand. Organising your finance is probably the hardest step, but help is readily available from lenders, so you can easily jump in and get started.
Research Phase is Short
As with all investment options, investing in property requires careful research, but after this initial research phase you should be able to make an informed and wise property investment. By comparison, investing in the stock market requires significant ongoing research. Those investing in the stock market will need to understand the different market sectors and read recent annual reports, prospectuses and research reports.
Return on Investment
If you do your research and invest wisely then you can have some guarantee that you will have some return on your investment. By comparison, the stock market is fraught with risks that may result in losses.
Property investment can offer a strong return. The interest offered by banks, even in high-interest bank accounts, is often no match for the capital gain which can be made through property investment.
An investor can also wait on the right time to buy and sell in order to maximise return on investment. Even if the value of a property is down, provided there is a healthy rental yield, the investment can remain sustainable. An investor can then choose to hang on to the property until the value increases again.
There is a degree of predictability in the world of property investment. The property market is relatively foreseeable and changes will often occur slowly. This means those who have invested wisely in property can forecast into the future, while the stock market can change dramatically in an instant.
There are a number of tax deductions that exist to help property investors. Property investors can claim things like real estate management fees, water and council rates, property maintenance and insurance. These tax deductions can significantly reduce tax by thousands of dollars. Tax deductions like these simply do not exist when it comes to other investment options.
Housing is a basic need and therefore there is always demand. This means that even during an economic downturn, properties with strong rental income remain a steady investment.
More for Less
Investing in property means your money goes further. Unlike other investment options where $80,000 will get you $80,000 worth of shares or you will receive interest on $80,000 only, a home loan means your $80,000 can get you a property worth $500,000.
Are you thinking about investing in property?
There are many benefits to investing in property, with simplicity and ease often at the top of the list. The cynics may point out that organising the right home loan is a complicated part of property investment, but with our help it doesn’t have to be. We have a range of home loans to suit investors and their needs. A dedicated lending officer can do the hard work for you so investing in property really is as simple as it sounds.