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Property Investment Ideas: Three Ways To Invest On A Budget

When you’re looking at potential investment properties, you’re also probably looking for property investment ideas. What real estate should you invest in, and how can you make those investments? Are there other ways to invest in real estate aside from buying and renting out properties? 

As you might expect, the answers to those questions depend on your particular situation. There are ways to invest in Australian real estate that doesn’t require breaking the bank.

Easiest Of The Property Investment Ideas: Buy On A Loan

You can buy an investment property with a mortgage. As long as you have a decent credit score and 5-10% down, it’s possible to get a mortgage for an investment property. If you have equity in a home you already own, then you can borrow against your existing home to pay for the new one. 

Over time, assuming you pick the area well, the rent from the investment property will pay the loan and provide you with positive cash flow. The plus side is that you do not need to outlay hundreds of thousands of dollars upfront. Even people that can afford to buy the property outright still do it on loan for cash flow and capital preservation reasons.

Buy Australian REITs

REITs (real estate investment trusts) are fantastic ways to enter the market without needing a significant amount of money. Traded like any other stock on the ASX, these organisations have a portfolio of real estate investments. Those investments tend to be commercial, and you don’t get to pick your properties, but if you’re looking for simple diversification, you can invest in REITs from your brokerage account. REITs usually have excellent dividends, so there is positive cash flow.

Rent Out Your House When You Move

If you’re looking at moving, don’t sell your home when you do! Instead, consider renting it out. You’ll be able to save on the closing costs of buying a new investment property (since you already bought your home for personal use before) and you’ll receive passive income. You can hire a property manager to handle any 2 am calls and any issues that arise when you’re away from your old home. It’s a great way to try having an investment property without putting out any new money specifically for an investment home.

Property Investing: Not Just For The Uber-Rich

One of the common myths about property investing is that it requires immense wealth. That’s nonsense. With these property investment ideas, you can gain access to one of the most reliable, simple ways that Australian families have been accumulating wealth for decades. 

While past performance is no guarantee of future results, property prices in Australia tend to outpace inflation. Therefore, by putting even a little bit of money into real estate, you’re helping to accumulate wealth. It doesn’t have to be hundreds of thousands. Even $50,000 or less can be enough to get you an investment property that will have a positive cash flow.

When you’re ready to invest, talk to us! We’re prepared to help you find the right property for your needs. 

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Real Estate Companies: Should You Trust Them?

There are thousands of real estate companies all over Australia. These types of companies can range from mom and pop shops that consist of a couple of property managers or they can be a large brokerage with thousands of employees and affiliates. However, many people question if they can (or should) trust the people providing these services. Can you place your full trust in your agent? Can you assume that a property manager will do the right thing?

When looking at investment properties, the element of trust is essential. You’re going to be making a substantial purchase – typically on the order of $500,000 or more – and you need to know that the decision you are making is sensible. Everyone will be willing to sell you a home and earn some commission, but you need to see if it’s the right home for you.

Unfortunately, the real estate landscape is fraught with spruikers. Here are three characteristics of bad companies.

High-Pressure Seminars From Real Estate Companies

Many property investment spruikers go around the country pitching seminars in which you can go to learn about investing in real estate. The problem is that many of these seminars are not for educational purposes only. Instead, the goal of these real estate companies is to sell you an investment property right there. Now. Sign on the dotted line and get rich.

The problem is that most of these investments are bad. That’s why there’s so much pressure to sign immediately and so many outlandish claims. Avoid these spruikers at all cost!

Limited Access To Developers And Builders

Some real estate companies focused on property investments have a minimal selection of homes from a small list of builders. They’ll market these homes aggressively, but they’re bad investments. 

Instead, the better organisations have access to bountiful inventory in all five states. That way, you’ll be able to pick the right investment home for your particular financial needs.

Guarantees

Some of these organisations will offer “rent guarantees” which will make you feel like you’re getting a good deal (after all, at least you can count on income from your investment). However, these guarantees – like most other types of warranties – are priced into the cost of the purchase. Instead of paying $400,000 for a home, you’ll pay $450,000, but they will “guarantee” your rent of $2,000 for two years. If you find no renters, they pay you $48,000 of the extra $50k you gave them. But if you do rent the property out, then they keep the whole premium. 

Those guarantees are not a loss for the company. You’re just paying an incredibly steep price for them!

Bottom Line

You can trust real estate companies, but you need to know the sales tactics of this industry to know which ones you can and cannot believe. The above tactics are red flags, and you should avoid companies that engage in those!

The above list is not comprehensive by any means. If you’d like to learn more, please visit Buy Australian Properties’ warnings on real estate companies. That page lists every dirty tactic that some organisations will use on unsuspecting buyers!

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Best Property Investment Australia: Finding The Right Deal!

If you’re on the hunt for the best property investment Australia, then you’re not alone! Property investments are one of the most popular ways for people to earn passive income without requiring any specialised knowledge. You don’t need to be an expert programmer or a trader to earn income from property investment.

The key, of course, is to pick the best opportunity. So, whether you’re looking at Perth, Melbourne, Sydney, or anywhere in between, here are three tips for finding the absolute best property investment Australia deal!

The Best Property Investment Australia Will Have Low Vacancy

If you ask a landlord what one of the primary challenges is with renting a property, they will probably answer “vacancy.” If you aren’t renting out your home, then it’s losing money. When this happens, if you have a property investment that has a mortgage attached to it, you’re on the hook to make those payments in addition to the other monthly payments you have to make.

When looking at property investment opportunities, pay careful attention to possible vacancy rates. While a small home in a remote town might seem appealing on paper, it often isn’t because you don’t have the same ease of finding tenants as with a place like Melbourne or Sydney. Therefore, pick a property that will have low vacancy so that way you will always have a passive income!

Your Property Should Have Growth Potential

The best property investment Australia will have equity growth potential. If you make your purchase in a big city like Melbourne, this generally isn’t a problem. With that said, across Australia, experts expect property prices to rise during 2020. Therefore, if you stick with large metro areas, you should expect to see your investment have not just passive income but capital growth as well.

If you ignore capital growth, you’re missing out on one of the best parts of property investments. There is something deeply satisfying about receiving monthly cheques and being able to sell your property for more money in the future.

Property Investments Should Have Fantastic Features

One of the best ways to keep property vacancy rates low is to have a home that everyone wants! If you buy a property near schools, shops, and transport options, then you will have no shortage of people that want to live in your particular property. However, if you buy something isolated and secluded, you may find it challenging to find someone willing to lease it from you.

Inside the property, look for “appealing features like a second bathroom, [or] a garage.” When you have these types of extras in your home, again, people will want to rent it out. The increased appeal plus the increased interest will help keep your rental income high and keep people wanting to be in your unit!

Finding The Best Property Investment Australia

If you want the best property investment Australia venture, look for one that is likely to have a low vacancy rate, has equity growth potential, and has fantastic features that will keep desirability up.

With prices rising across the country, finding the perfect property investment may be challenging. However, with the experts at Buy Australian Property, we can help get you set up with property investments!

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Property Investment Perth: Three Reasons To Invest In Perth

Investing in property is always a smart idea. Between rents and capital appreciation, this type of investment has the potential for significant returns. It’s not uncommon to see ROIs of 10% or more if you purchase the right home! Property investment Perth is a fantastic investment strategy in large part because of the city’s vibrancy and robust economy. If you’re looking to buy a rental property, here are three reasons why you should consider Perth as your next destination!

Property Investment Perth Works Because Of The Robust Economy

Perth has a robust economy. Western Australia has a significant deposit of metal and coal, which has led to a boom in economic exports. A healthy economy is critical for property investors since the highest ROI happens with consistent, high rents. If you’re not renting out your property at a price that makes sense and earns enough, then the investment strategy falls flat very quickly. Fortunately, Perth has a healthy economic outlook, so your rental property investments are likely to be safe for quite a while!

Properties Are Inexpensive Relative To Other Large Cities

One of the most attractive aspects of Perth is the fact that property prices are low in comparison to other large Australian markets. The median home price is around $520,000. By contrast, the latest housing indicators show that the average home price is $1.1 million in Sydney.

While $520,000 is not a small sum of money by any measure, providing enough of a down payment to obtain a mortgage is significantly easier than doing the same on a $1.1 million property. Another aspect to consider is that you can buy two homes in Perth for the cost of one in a place like Sydney. With two units rented out, you have some cushion in case one of the tenants leaves (in which case, you still have the other property rented out). If you buy a single expensive home, then if that tenant bails, you’re on the hook for maintenance, taxes, and other miscellaneous costs while you’re looking for someone else.

Perth Has Healthy Rental Income

Despite the comparatively cheap home prices, Perth properties still achieve a healthy rental income. Estimates put the average apartment in the city centre at $1,400 per month for a one-bedroom and $2,300 per month for a three-bedroom. Assuming you can rent out your $520,000 home for even $2,000 per month, you’d be looking at a 4.6% return per year, before capital appreciation. That’s pretty good considering some of the other investment alternatives out there!

The Right City Makes Property Investment Amazing

Property investment Perth is a fantastic strategy because the city has a robust economy, comparatively low property prices, and a healthy rental market. These three factors make Perth a great place to purchase property!

If you are interested in buying investment properties in Australia, please contact us today! We’ll be more than happy to work with you to find the right investment property for your needs – whether that property is in Perth or elsewhere within the nation!

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Three Steps To Make A Smart Property Investment

If you’ve been thinking of investing in real estate, then congratulations! You are one step closer to making a wise investment decision. With the potential for capital appreciation and consistent rental income, investing in real estate is one of the best ways to diversify your portfolio and achieve significant financial gains. If you’re looking to make a smart property investment, here are three steps to achieve that goal!

A Smart Property Investment Involves Research

The best investments require some level of research. There are two types of study needed. The first is into property types, areas, and potential properties that you might want to purchase. The second is “research” into your finances and goals. What are you looking to achieve with this rental property? Do you want consistent monthly income? Or, are you looking for an investment that will appreciate significantly in a few years? What your overall goals are will guide your investment decisions.

Decide On Financing

Once you have an idea of your finances and what type of property you want, you should decide on what financing, if any, you will need. If you’re looking at obtaining a mortgage on your property, you should consider discussing your ambitions with a bank to see if you would qualify. Assuming you’re not paying cash for the property, then the ability to obtain financing will be an integral part of any offer that you make!

Work With A Professional Real Estate Company

After you broadly know what type of property you want and understand your goals, you can then work with a professional real estate company, like Buy Australian Property Investments, to find the smart property investment for you. These companies can help you find the best properties in which to invest and can also potentially help guide you in the right direction in terms of financing.

The right property investment company can also help find opportunities that are best suited for you. Not all investors are made equal. Some investors like high cash flow while others like the potential for significant capital appreciation. Some prefer to play it safe while others want to take substantial risks in anticipation of big payoffs. Therefore, what is a smart property investment for one person may not be a smart property investment for someone else! By working with a talented and experienced property investment company, you can ensure that you are buying a property that will help you achieve your goals!

Property Investment Pays Off

Although there is some initial legwork in finding the right investment deal, the payoff is worth it! According to one source, residential investment properties have historically achieved an 8% return on investment. Of the significant equity groups (cash, stocks, bonds, and real estate), properties had the greatest average return on investment. The next highest, of course, was stocks at 6%. However, stocks can also be a little riskier. A home is always in-demand, assuming it is in the right area, but a company can go bankrupt!

If you’re looking to buy an investment property in Australia, get in touch with us today!

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Property Investment Guide For Australia

Whether you’re looking at properties on the sunny beaches of Sydney or you want to invest in the bright lights of Melbourne, you should consider the pros and cons of this form of investment. In general, properties tend to be desirable for investors of all classes because they have monthly income and appreciation potential. To find out if these types of investments are right for you (and which ones you should make), read the following property investment guide for Australia!

Property Investment Guide For Home Types

There are three primary types of properties that investors buy. The first are single-family homes. Investors like single-family homes because they have a transparent ownership structure. There is no board of directors to deal with, and you can make renovations whenever you feel like doing so. Another type of property is a condo. Condos make for attractive investments as well because they tend to be cheaper and more limited in terms of what can go wrong with them. The final, but less common, property type is a multi-family complex. You might buy a building that can house four different families and rent out each section individually.

There is no universally perfect investment. If you are new to property investing, you may wish to buy a condo to start. Renting out condo lets you have a monthly, stable income and limits your downside risk (there are no foundations to crack or termite damage to repair with a condo). Condos also tend to be cheaper than homes. Although, if the area is in high-demand, condos may still be relatively expensive! If you prefer a little bit more flexibility and a higher overall return on investment, then a single-family home might be a better option for you!

Monthly Income And Appreciation

Very few investments offer potentially significant monthly income plus the opportunity for capital appreciation. It’s not unheard of to put $200,000 into a house, wait ten years, sell it for $300,000, all while making $10-20k in rent per month on the initial investment. In this hypothetical scenario, you would make 50% on your initial investment after ten years, plus 10% of the home’s value per year in rent. There isn’t another investment type quite like it!

On the downside, investment properties still require upkeep even if they don’t have a tenant. For this reason, finding the right tenant – the one that will pay market rate for a long duration – is the best way to ensure you receive the highest ROI on your investment.

Deductibility Of Expenses

If you buy property in Australia (which, with this property investment guide, we hope you do!), you can deduct many of the expenses related to the investment property. The costs of advertising, loan fees, maintenance fees, etc. are all tax-deductible. Sometimes the losses can be used to lower your overall taxes. Therefore, if you make $20,000 per year, but have to pay $5,000 in expenses, you’ll only pay income tax on the $15,000 profit. The flexibility of deductibility of costs can be fantastic during tax season!

Property Investment Guide: Australian Property Is Always A Good Buy

No matter if you’re looking for a condo or a single-family home, buying a property in this fantastic nation is always a good idea. Of course, at Buy Australian Property, we can answer any questions that you may have about these types of investments. If you want to learn more about property investing, get in touch with us today!

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Property Investment Australia: Three Characteristics Of The Best Deal

As an investor that is interested in real estate, you’re probably always on the hunt for the best property investment Australia. You might be looking online yourself or working with a real estate agent to find the best deals in the country. If you’ve done research online, you’ve likely seen various opinions on what makes the optimal investment opportunities. While various property investors have different thoughts on what constitutes the best investment, there are three characteristics of any potential property investment Australia opportunity that are critical to its success.

The Top Property Investment Australia Has A Clear Timeline

A clear timeline is one of the most crucial characteristics of a fantastic deal. You can crunch the numbers all you want, but without any idea of the timeframe, you cannot plan your finances accordingly. Are you looking for a property that you will buy and hold forever in pursuit of passive income? Or, are you seeking a home that you can stay for a few years and then sell for a profit? These two goals are very different and typically don’t result in the same investments.

If you’re looking for a property that you will buy and hold forever, then you’ll want to optimize for passive rental income. What value the underlying asset has is (somewhat) irrelevant. You want enough monthly money to make the capital expenditure worthwhile. Conversely, if you’re looking to get out fast, you want to invest in a place with potentially significant capital appreciation.

The best property investment Australia is one that you know the timeline for and it matches with your expectations as well.

Significant Returns

Of course, an investment property without significant returns is not a property you would want. The Commonwealth Bank of Australia suggests aiming for a rental yield of 5.5% or higher. They also suggest that if the return is below 4%, then the property is too expensive. Of course, these are merely guidelines. You have to decide on how much risk vs. reward you’re willing to take on for this investment. However, when looking at the best deals, the ones with the highest possible profits are, obviously, the most optimal!

An Exit Strategy

If things go south (e.g., you have an extended period where you have no potential renters), then you need a way to “get out” of the property without losing a fortune. Putting all your proverbial eggs into one basket is generally not a good idea. Investing in highly sought-after areas tends to mitigate the risk that you might be “stuck” with an unwanted property. Conversely, if you invest in a home out in the middle of nowhere, then you might find yourself unable to sell it if things go wrong. The best deal will have a reliable and viable exit strategy. You don’t want to lock in your money to a property that is hard to re-sell if things go wrong.

Property Investments Are Fantastic Ways To Diversify Your Portfolio

The best property investment opportunities in Australia are fantastic ways to diversify your portfolio. When you find a property that has a clear timeline, significant returns, and a viable exit strategy (in case there are issues), then you will have found a fantastic deal!

If you are interested in buying investment properties in Australia, please get in touch with us today!

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Can you still get finance for a property investment?

The question that’s on property investors, mortgage & finance brokers, banks, property experts and the mum & dads ‘minds at the moment is, can I still borrow money to buy an investment property?

The simple is yes, there is still plenty of money around to purchase a property investment despite what the media is saying.

It’s true that some of the lending criteria has changed and I believe maybe it’s better for the client. It’s also true that some people are finding it harder to get loans and maybe they really should not be buying a property investment at the moment, probably because they really can’t afford it or don’t have enough equity in their current home to do so. It’s also true that the powers that be (governments, government bodies like ASIC, APRA, RBA and others) are playing a political game of cat & mouse regarding the property market which I believe is influencing the media to a large degree as to what they put out each day. Remember there is an election coming up so lots of things change when this occurs.

The best way to obtain finance at the moment is go to a qualified and independent mortgage broker who has plenty of options for finance and get a financial assessment of your current situation. Listen to what they say and maybe its not the right time for you to purchase a property investment, you might have to save more, change your spending habits, cut back or look at a different type of property but you will get there in the end if you take your time. Don’t rush and buy a property investment based on FOMO (Fear of missing out) as there are thousands of good, quality property investments available all the time.

So, don’t give up on your dreams, goals and aspirations of being a property investor, just start planning it better. Work on a long-term strategy for success and talk to your finance broker, accountant, financial planner and property expert who is independent and client focused. Work with independent professionals who have integrity and your best interests at heart.

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Start investing as young as possible

When should you buy your first property investment? It’s a really good question to ask yourself.

Answer = as young as possible, as soon as you can, as soon as you can afford too, when you get a full-time job, when you get a part-time job, when you have a deposit, when your parents gift you a deposit, when you inherit some money, when you win some money ( although I would not count on this strategy).

All the above answers are correct, the quicker you get into the property market the better. Now as some of you might know already, you don’t need to stop renting to getting into a property investment, you can rent vest (buy a property investment while still renting a place) or even stay at home and buy your first property investment while living with mum and dad.

Gone are the days when you save up a small or large deposit and buy your first home to live in. Some cities and suburbs in Australia the property prices are now so out of reach for the average person plenty of people are buying a property investment before their principal place of residence. At least this way they are getting into the property market and getting some capital growth which, they can use down the road for a deposit when they eventually buy their home to live in.

Take for example, my daughter, living at home and going to university, working part time and she has already saved up a small deposit by the time she is 20. I am about to gift her the balance of deposit to buy her first investment property in 2019 and by the time she is 21 and finished university she is on her way and in the market.

So, when you are talking to your clients, your friends, your family and they ask when the best time is to start investing in property, tell them now. Its never too early to invest and you are never too young.

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Is regional Victoria a good place to buy a property?

With the Victorian government plan to de-centralize Melbourne and move some industries out of town due the massive population growth its experiencing, a lot of property investors are looking towards regional towns to purchase their next property investment in.

If you look at the growth that some of the houses in regional towns like Geelong, Ballarat, Bendigo, Shepperton have experienced in the last 3-5 years you can quickly see that some think is going on. Large parcels of land in these towns have been rezoned to residential land to make way for the influx of people moving into these regional areas as the cost of property continues to blow out in the Melbourne suburbs.

In some of these towns and others in regional Victoria you can still buy a house at approximately 50% of the cost of the medium Melbourne property price, which in turn makes the rental yields for property investors a more attractive option than buying in some Melbourne suburbs.

With the increased demand and pressure on the government to provide affordable housing options the regional towns are looking good and will continue to expand, with the jobs and industry quickly moving out to these towns. As more businesses relocate to regional towns the demand for housing will continue and property investors are the ones who will benefit.

So, is buying an investment property in regional Victoria a good idea? In my opinion it’s a big Yes, I think that there are some really good buying opportunities. You still need to do your research carefully and don’t rush into buying anything, take your time and make a well-informed decision before buying.

Click on the links below to see the future of regional Victoria.

https://regionalliving.vic.gov.au
https://www.rdv.vic.gov.au

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