There are many compelling reasons why property is a great investment. Here are our top 10...
1. Residential Property is a commodity no-one can do without.
Think about it. If you look at the 22 million people living in Australia, is there one person who doesn’t need this commodity?
Whether one is a property owner, property investor, a tenant (or a combination of these things), it’s pretty hard to avoid the need for property isn’t it. Everyone needs a place to live!
Evidence of this can also be seen in the fact that the total value of Australia’s property market approximates 4 times the value of Australia’s share market.
2. More millionaires have been made through property than any other type of investment.
If they can do it, so can you, right?
There’s no need to be The Lone Ranger. No need to reinvent the wheel! Ok, i think you get my point!
If the majority of financially secure people have achieved their security through property, then you can too!
3. Property gives you the best leverage
The banks love property. They love it because it is consistently the most secure & safe investment. Therefore, they are willing to lend up to 80% of the value of a property (without Mortgage Insurance) and up to 95% of the value of a property (with Mortagage Insurance).
So what does this mean for you?
It means you get a lot more bang for your buck! You are getting growth on a large asset, without having to put up large money!
Typically, a property investor who has access to good quality advice can become a property millionaire in 10 years or less.
With access to Property Portfolio Partners wealth of knowledge and experience and a carefully planned out investment strategy, this can be you!
4. It’s a safe investment
Ever heard the term, “as safe as houses”? What about, “you can’t go wrong with bricks and mortar”?
There are reasons why residential investment property is so safe.
As mentioned earlier, everyone needs a place to live... This makes property an investment that behaves differently to most others.
Between 65 - 70% of people who own property are home owners, not investors. This means that property is far more steady and secure than say, businesses or the stock market.
We’ve all seen the rise and fall of stock markets. We’ve all seen companies (even ones that were supposedly blue chip) go broke.
Have you ever heard of a house going broke? If the economy starts to falter or the markets slow down, you don’t see people rushing to sell their houses like you see investors rushing to sell their stocks do you.
This doesn’t mean property prices don’t fluctuate. It just means that they are far more consistent, steady and safe than other investments, largely due to the stability that the big homeowner market brings.
Another significant factor contributing to the safety of property is the fact that property can be insured against almost all risks, unlike many other investments. You can insure a property against fire & natural disasters and landlord insurance is available to insure you against damage to your property, loss of rent, etc.
5. Consistent growth
Property almost never fails to grow, if it is treated as a long term investment.
At Property Portfolio Partners, we understand that by selecting the right property, in the right area and with the best financial structure, your returns will be consistent.
That’s because, over the last 40 years in Australian capital cities, property has never, over a 10 year period, failed to at least double in value. For very well selected property, doubling in value every 7-8 years has occurred routinely!
For eg. Over the 3 decades from 1980-2010 median house prices in Sydney averaged 8.3% Capital Growth, Melbourne 9.05% and Brisbane 10.16%. (Source RP Data). At an average rate of Capital Growth of 7.2% per annum property doubles in value every 10 years.
6. Amazing tax benefits
Quite a few years ago now, the Australian Government realised they had a growing problem. The demand for residential property.
Not wanting to meet this all of this demand themselves (through government housing), they introduced tax relief measures to encourage investors to take up the slack.
As a result, Australians enjoy some of the most favourable tax advantages of any country in the world when it comes to property investment.
We can’t go into immense detail here, however in your first meeting with Property Portfolio Partners, you will be provided with a full education on exactly how these tax benefits work and how you can take full advantage!
7. You never need to sell your asset
With property you never need to actually sell your investment to realise the capital gains you have made.
When your property portfolio increases in value, so does your access to this value. With a smart financial structure, Property Portfolio Partners are able to assist you to get access to your profits without ever having to sell the geese that are laying those golden eggs!
8. You have direct control over your investment
Unlike shares or managed funds, with property, you are the owner of the whole investment, so you have control over it.
You can renovate it, sell it, increase or decrease the rent, etc...
9. Three Sources Of Income
Most investments generate only 1 or sometimes 2 returns.
Property generates three!
Rent. They say renting is dead money. Not if you are the investor!
Capital Growth. The history of residential property is one of consistent capital growth over time. Based on this history, property has doubled in value on average every 10 years. This means the likelihood of your property increasing in value is strong. Whilst you are working, your property is growing. Whilst you are sleeping, your property is growing. Even when you are on holiday, your property is growing!!
Tax Returns. Believe it or not, the Australian Government meets a significant level of your costs by giving you tax back! Now you can probably argue that this isn’t a return as it’s your money they are giving back to you. Well, you’re right... It IS your money... We like to count this as a return though, as there are no other investments that will give you back so much tax!
10. Anyone can invest in property
Many investments require significant existing wealth.
This is not a pre-requisite to investing in property.
With an average or better wage and some equity in your existing home, you may be eligible to invest in property straight away! This is because the banks will lend you at least 80% of the value of the property.
This factor alone puts property investment within the reach of most Australians.
However, that doesn’t mean that all eligible Australians will invest. Despite the attractiveness of property, the tax benefits and how accessible this investment is, many people succumb to the fear of the unknown or listen to friends and family who invariably know of someone with a property horror story.
This doesn’t have to be you.
Property Portfolio Partners have over 37 years experience in the financial planning & property investment fields. We specialise in making this process as simple, easy and safe as possible for you and your family.
We take the hassle, the risk and the headache out of property investment.
Property Portfolio Partners have helped hundreds of Australians to secure their future with property. Give us a call today on 03 9876 7722 and find out how we can help you to do the same.