ACT’s Professional Advantage: Save $70,000+ in Australia’s Most Stable Market
The Australian Capital Territory offers first home buyers a unique combination of Australia's most stable employment market and strategic...
“If you put your money in the bank, you’re probably getting two and a half percent and then you’re paying tax on it. So you’ll probably end up with one and a half percent of your funds as opposed to having an offset account…
In building up the offset, you’re building up your deposit for all your renovation budget for this property…
The other thing is, you pay it down and start paying a little bit of the principal off which a lot of people like doing. We talked about the benefits from an interest rate, it’s not going to have such a big difference to you on such a smaller loan amount.
But you know, it’s money that you don’t get on a longer period of time that you have to save to get to your next property.
So at this lower at these lower price points with a huge amount of yield that you’re getting, often you don’t have the growth potential. And that means that you have to save the equity to buy the next property rather than pull equity out of the property that you’ve got now…”
If you’d like a complementary call to look at the options of different loan types can provide then book a call http://investorschoice.com.au/bookacall
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“The question around fixing really comes down to your personal circumstances.
For instance, if you’re planning to buy and hold and just keep the property and not do anything to it, then potentially, fixing it for a longer period of time is not a big deal.
If you’re going to sell in three years time and you fixed for five years, then that could be an economic break costs for you…
If it is a buy and hold, you’ll possibly find that the fixed rates are a bit lower even for extended periods. But if you don’t do anything with that property, access equity for any reason, or even sell it, the economic brake cost could be quite high…”
If you are interested in completing a self assessment whether you should fix or not download this ebook https://investorschoice.com.au/shouldifix
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“What’s happened with portfolios is people are actually looking at a neutrally good portfolio. They’re looking at some growth and they’re looking at some yield.
They don’t have to have one strategy. I think a robust, experienced investor or someone planning their investment portfolio would look into having that combination of wanting to be in a growth area and we understand that it’s gonna cost us a little bit.
But we also want to have rent to help us to pay for that. And it’d be nice to be able to add some equity to that property by maybe renovating”
If you’d like a complementary call to work out how these strategies affect your borrowing capacity then book a call to https://investorschoice.com.au/bookacall
#propertyinvestment #portfolio #homereno
Approximately 30% of Australians live in rental properties.
Mainly because many people struggle to afford to buy where they want to live.
But things have changed, with just a 5% deposit and in most cases a reduced or even no Stamp duty it can be cheaper than you think to buy.
Here are 3 reasons why buying now makes sense.
1. If you buy in an area that is growing in value, then you are building equity in your property and wealth for your future.
2. At the right time, you can access this equity for other major purchases.
Plus, it can act as an emergency fund to help you if you find yourself in a bind.
3. When you rent, all the money you spent goes to an investor.
That means you’re not building your own savings through equity, what you need to do to achieve what you want in life.
Yes, we’ve seen price declines in several major cities, but they are now rebounding.
Those declines come on the back of several years of huge growth.
And over the long term, your property is much more likely to grow in value.
However the key is to buy in the right location at the right time.
Anyone who’s rented before knows how restrictive it can be.
You should have the freedom to do what you want in your own home.
That freedom comes from buying.
You’re creating a more stable environment for yourself that you have full control over.
The problem is that so many young Australians feel like they can’t buy that first property.
But we can help you to access the Grants and Stamp Duty Concessions your entitled to.
That will help you find the property that you want, and even where you want, without all the costs you might expect.
And if you follow our five-step framework, you can be a homeowner. Join our First Home Buyers community https://www.facebook.com/groups/firsthomefirstinvestment /
If you are surprised at how prices in cities and regional areas have risen even in the face of the social and economic havoc caused by COVID-19, you’re not alone. If you are thinking of buying property, you may even be a little concerned about what the current property market means for your buying decisions.
Is timing everything, or is time in the market more important? Whether you’re a first home buyer, upgrader, or investor, let’s look at what a property cycle is and how important it may, or may not be to your buying decision.
Generally, home prices follow a four-phase cycle of Stabilisation, Growth, Boom and Decline. Over the last 40 years, property prices boomed in Australia in 1981, 1987, 1994, 2003, 2010 and 2017. This is why many people work on the assumption that property cycles last roughly seven years. But remember, this is an assumption, not a fact.
The longest phase in the property cycle is usually Stabilisation. This is when buyers and sellers have enough confidence to enter the market in relatively equal numbers, keeping prices fairly stable.
Many factors contribute to a rising market, but a Boom tends to end as more sellers enter the market, causing an over-supply as prices tumble and the market moves into a Decline phase.
Low interest rates contribute to market increases, as does strong economic performance and consumer confidence.
The supply of property on the market also plays a big part in contributing to rising (or falling) prices and rents, as does shifting demographics including the number, age and incomes of people in households and where people are living. A good example of the impact of shifting demographics is the recent spike in regional home prices as younger people leave cities for the regions.
Although we talk about the property ‘market’ there are as many property markets as there are suburbs around Australia. While we have seen unusual consistency in increases across the board in Australia recently, different states, cities and suburbs can be at varying stages of their property cycles.
The recent price surge could be what’s known as a mid-cycle ‘second wind’ caused by buyers cashed up with government incentives and lockdown savings, taking the property plunge or making a lifestyle change. It could also be viewed as a correction, as people who put off buying at the start of the pandemic, enter the market. Or, as it is in most cases, it can be a combination of factors.
Either way, the fear of missing out, is a contributing factor to the growth phases of property cycles and it’s what makes many people anxious about when they should enter the market. That’s why it’s important to take a step back and remind ourselves that over the long-term, property prices have historically risen.
What this means, is your property goals will dictate how much attention you should pay to where the market is currently in the cycle. Are you looking for your forever home, a long-term investment or a do-er upper you can quickly sell for a profit? Your answer will tell you how important your entry point in the cycle is. For many, it’s not what should be driving your buying decision.
Keep in mind that market forecasting is difficult. Rather than trying to time the market for short-term gain, many buyers prefer to look further into the future and aim for longer-term property growth.
The important thing is to buy according to your goals and means. Ensure you are comfortable with your purchase including the area you are buying into and the amount you are borrowing.
We’re always happy to discuss your property plans and current market movements with you. So please get in touch.
The Australian Capital Territory offers first home buyers a unique combination of Australia's most stable employment market and strategic...
The Northern Territory offers Australian first home buyers the most generous grant support in the nation, with the HomeGrown Territory...