Why Property

Almost every experienced investor or adviser will tell you that you need a balanced investment portfolio and that property should be a cornerstone...

If you are considering making an investment in property, either for the first time or as an experienced property investor, you should know already that nothing comes easy in life and that you have to do your homework to succeed.

There are the obvious questions such as location, how much you can afford and what sort of property investment finance best suits your situation. Dig a little deeper and you quickly start to understand that, although property investment has great potential in terms of income, capital gain and eventually wealth, it is a serious business. As bright as the upside may appear, the practicalities of finding, investing in and operating an investment property also carries with it additional effort and some risk.

However, if you are smart enough to be considering investing in property as part of your overall investment strategy and plan, you are probably also capable of weighing up the advantages against any potential downside.

Here are just a few things for you to consider

  • Location - including access to transport and facilities in relation to what your tenants are seeking
  • Property investment finance – often very different to a typical home loan
  • Tax – discuss the best structure with your accountant well before you start looking
  • Time – buying and then operating an investment property takes a lot of time
  • More time – consider over what period you are going to own your investment property
  • Budget – work out all the upfront and ongoing fees, commissions and outgoings
  • Cash flow – understand the importance of balancing income and expense timing
  • Selling – what are the resale prospects if or when you decide to capitalise on your position

While there's some risk in any investment decision, property in Australia has proved to be remarkably stable. Instead of simply offering opinions, here are a few facts.

Property value has increased an average 8% per year over the past 100 years.

This period includes two World Wars, major conflicts such as Vietnam, Afghanistan, Palestine, Iraq (2), recessions, global crises such as 9/11, SARS, the emerging markets crisis, and even the latest global financial crisis, or GFC as it has become known.

There are renters out there, and more coming, who need people like you.

With a current backlog of 200,000 homes needed, a number that increases by a further 30,000 homes per year, an undersupply of developed land and a shortage of funding for development companies, there is a serious shortage of housing in Australia, no wonder many experts call it a housing crisis.

Through natural population increases and new arrivals to The Lucky Country, Australia's population grows by about 400,000 per year. This alone demands an extra 133,000 homes a year, assuming 3 people per household.

As a result of this continuous demand, property prices and rentals will rise steadily. Along with strong demand from renters, and with generous assistance from the government to assist supply, our investment property concept is the envy of the developed world.

The only real risk for new property investors is in trying to go it alone, and making costly mistakes simply through a lack of research or knowledge. With Australian Investment Realty you do not have that risk. Nor do you have your family and work time consumed with financing, sourcing, building and property management issues. Lower risk, greater returns, more time for yourself and your family.