If you are looking to get into Property investment you will want to do your research and take advice from people who know what they are talking about. Property investment, done correctly, can make you rich, in time of course. Investing in property is sometimes risky, especially due to the current economic situation. Today we are going to give you some great property investment advice that should stand you in good stead if you want to dabble in the housing market.
Property investment is said to be Less of a risk than shares. It attracts many people from many different backgrounds and has two main benefits : the tax advantages from negative gearing and the capital growth.
Negative gearing in property investment means buying with money that came from a loan that has the annual ‘rent’ less than the loan interest and the expenses paid for the property’s maintenance together. Doing this brings benefits from taxes and the most important thing is the interest of your mortgage.
Capital growth represents the money made from the value of your properties. This is not guaranteed, because you have no guarantees that the value of a property will raise.
If you plan on starting to do some property investing you don’t have to start by investing in a place where you also live in. You can for example buy an apartment that you can then rent out. Furthermore, property investment that’s done in a place which you are not going to occupy takes some of the stress and emotion of what and where to buy.
One of the first things you must consider after you’ve decided do perform a property investment is where to buy. It is recommended that you try to buy in a growing area that provides everything a tenant is looking for: shops, transportation and leisure.
Another useful tip if you plan on renting is to choose an apartment instead of a house because they are easier to maintain and a great part of the expenses are shared with the others.
A risk in property investment is that the value of the property you bought may decrease, and you may be forced to sell the property quickly, so consider this when buying and try to pick an area where you know you can always sell the property with no efforts.
And the last advice about buying and renting a property is that before doing the property investment you can ask a little about the history of tenancy in the area, if there are many tenants, if there are periods when the apartments aren‘t occupied.
After doing the property investment in a property that will be rented you can pay your ‘rent’ for the loan from the bank, if you got one, and when the ‘rent’ is finished you will no longer be negatively geared, but positively geared. This way you’ve made your property investment pay for itself. Not being negatively geared anymore makes you lose the tax advantages, but you should still be able to make profit.
If you want to get into property investment but you feel that you don’t have the time to manage and take care of everything, you can hire a property manager that will take care of the property management for you. The fee for such a thing is somewhere around 5% of the profits, but it has many advantages, you save a lot of time and you will benefit from the experience and knowledge property managers have in this domain.
We have listed some of the basic information you will need if you want to start investing in property. Property investment is not easy so you should take this advice on board and do further research if you think that this is the thing for you.