There’s no doubt Aussies love property. Why the obsession? Maybe it’s because it’s easy to understand or because governments tend not to play around with it as much as, say, super or the fact that you don’t need to be rich to build wealth.
Yes, you need a massive deposit to get started but as our experts show you can build wealth, one home at a time, with an average income. Negative gearing and depreciation perks mean you could afford an investment property for as little as $30 a week.
To help you become the best possible property investor, Money has rounded up some of Australia’s most respected advisers and investors. These people walk the talk, each of them being successful property investors in their own right. Everything – from where to buy, how to set up your loans and manage your investments, and the tax perks – is covered in this special edition.
On sale Monday April 25, 2016. Here’s a little taste of what’s in this special edition….
24 key questions answered
Investing in property is a proven way to build long-term wealth. Our guide will point you in the right direction and answer some frequently asked questions such as, what are the benefits of investing in property? Should I buy my first home before investing in property? How much deposit do I need to buy an investment property? Should I pay principal and interest or interest only? What if I want to leave property to my children?
Earn $55K a year in rental income
A carefully structured property portfolio can provide you with all you need for a comfortable retirement. Our strategies show how three typical Australian households can set up a passive income stream for their later years. Too good to be true? Not really. After profiling three household types to see if this is in fact possible by retirement, the conclusion is simple – the typical Australian can do it. Money reveals how…
Property versus shares
Investors will know property and shares can work for you at times but that occasionally they can go against you. If you understand this and are prepared to ride the wave during the good times and brace yourself during the bad times, you should come out in front. Money reveals the pros and cons of both.
Property for $30 a week
Do you have a spare $30 a week? If so you can probably afford to invest in property. Yes, you read that right – just $30 a week and you can become a landlord. Once you take into account the rental income and the tax benefits, buying an investment property is clearly more affordable than many people realise. Three experts come up with three scenarios to cater to a range of investing budgets: $30 a week, $150 a week and $250 a week.
The next hotspots revealed
The best advice for property investors seeking growth in 2016 is to beware of generalisations. Last year ended with a chorus of “the boom is over” articles and with predictions that “Australian property prices” would grow only 4% or 5% in 2016. What they meant (or should have) is that the Sydney boom is over. Whilst Sydney’s market may be cooling, there are many other opportunities for the savvy investor.
Profit from developing
Many investors renovate and/or extend their properties to manufacture more rapid capital growth. And some buy properties to do up and sell as quickly as possible in a process called “flipping”. We reveal five strategies you can employ to improve the bottom line from your real estate investments.
Investing property through super
Why would you want to invest in property using your personal super fund? Generally speaking the answer is the word “tax”. Income earned by the property is taxed at a concessional rate (generally 15%) and the capital gain will also be taxed at a concessional rate (generally 10%) or even, if you have retired and your fund is in pension phase, not taxed at all. We explain how these strategies work and the trouble spots to avoid.
Depreciation: cutting your tax bill
What is depreciation? It is essentially a tax deduction available to property investors. Your investment property earns an income (in the form of rent from your tenants). So, as with any activity that produces an income, there are various tax deductions available. Money reveals how generous deductions on an investment property can put thousands of extra dollars in your pocket.
Spot the dud
Stamp duty concessions and tax perks in the form of depreciation are among the reasons home buyers and investors might consider an off-the-plan apartment. But the biggest benefit is that you lock in the price. This safeguards you against rising values and gives you time to save more money before your new apartment is complete, get ready for retirement. Whilst off-the-plan property can pay off, it’s important to do your homework.
Loan secrets exposed
Are the following statements true or false? There’s no such thing as a standard variable rate. Mortgage offset is better than redraw. You’re better off refinancing if you’re not on a good deal. Chances are if you lock in you’ll get it wrong. Weekly repayments are better than fortnightly. Is your head spinning yet? Don’t’ worry! We set the record straight on some popular beliefs about mortgages and interest rates.