Property investment is one of the most popular ways in which Australians choose to grow their wealth.
The combination of a passive rental income with growing equity in an appreciating asset is certainly an attractive one, particularly as with property investment loans you can purchase a piece of investment real estate at comparatively high leverage.
For first time investors however, it may be daunting to take the first step and enter the arena. How do you know where to start and how to proceed?
Get to know economic indicators
Investment real estate is a market and it has its ups and downs. Unless you are a property-savant it can be hard to accurately predict the exact movements of such a complex set of relationships.
Yet that doesn’t mean you can’t make educated guesses, and the quality of those guesses will depend on how much you educate yourself about current market conditions.
There are lots of different statistics which can help you form a picture of the market and influence where and when may be best to buy.
Housing market activity can be gauged by looking at auction clearance rates, loan commitments and housing starts which is an economic indicator that reflects the number of privately owned new houses on which construction has been started in a given period.
Similarly, an overview of current rental activity can be gained by studying vacancy rates, median rent prices and investment loan commitments.
Learn how to get maximum benefit
If you don’t know what negative gearing is, we can refer you to some expert advice.
Property taxes and other legislative requirements are not the same for investors as they are for people buying property to live in themselves.
That means you will have different obligations, but also different opportunities – so be sure to clue yourself up.
Talk to an investment loan expert
A Good Mortgage Broker can structure a personalised investment finance deal that gives you the funds you need to start your property portfolio.
They can also provide you to someone for helpful tax advice for investors and talk you through the insurance covers you will require as the new owner of an investment property.
A Mortgage savvy Broker has a great range of mortgage calculators to help with all those tough decisions that come with finding the right loan.
Disclaimer: It is designed for publication, to provide you with factual information only, and it is not intended to imply any recommendation about any financial product(s). The information in the article is believed to be reliable at the time of distribution, but neither Ok loans nor its accredited brokers warrant its completeness or accuracy. For information about whether a bank loan may be suitable for you, call us on 0431579459
Credit Representative Number 534490 is authorised under Australian Credit Licence 384704.