Four ways to benefit from property investment

With interest rates at such a low, sticking your money into a savings account isn’t reaping the rewards it used to. Even the long-term savings accounts aren’t offering great returns.

So where do you invest? Shares? These can be difficult to understand and in a volatile market, they can be unpredictable. This is why many people look to property to make their hard earned cash work for them.

Investing in property does have benefits. For starters, it’s relatively easy to understand.  Here are four more ways you can benefit from investing in property.

Earn an income

Imagine having an income without having to do too much work. Yes, you will have to put the work in initially with researching the market and finding a property. And yes, you’ll have to work out financing and doing some sums to ensure the rent more than covers the ongoing costs, such as strata fees and council rates.

But, once you have a good property manager who’ll find you a good tenant, you’ll have a monthly sum of money coming into your account.

Help for retirement planning

Diversity is a good rule of thumb when planning for your retirement. Everyone has to have a superfund these days and there are some great additional retirement plans out there. Investing in property can be a savvy move when it comes to planning for later life – and in some cases, it may enable you to retire early, or at least work part time.

Have a chat with a financial adviser to discuss how investing in property can be a part of your retirement portfolio.

Capital growth

Generally property does increase in value over a number of years. Known as capital growth, savvy property investors take advantage of this in a couple of ways:

  1. Sell the property and use the lump sum for other investment strategies or personal purposes.
  2. Use as equity for another loan to buy another property, be it another investment property or their dream home.

Tax Benefits

There are a lot of tax deductible benefits when it comes to property investment. Management fees, interest on the loan borrowed to finance the property, strata fees and some maintenance can all be used to offset any income earned through rent.

Plus, if you’ve negatively geared your property, you’re effectively saving because you’re reducing the amount of tax you may have to pay on other incomes.

Investing in property is a long-term investment opportunity but you do need to make sure you’re properly informed of all the options for your situation by speaking to a financial advisor.

Want to know more about how property management and investment works? Our knowledgeable and experienced team would love to help.

With over 40 years of business in the area, we are one of Newcastle’s longest established real estate offices, so give us a call on 02 4954 9777 or pop into our Cardiff office for a chat.

For more investor and property management tips check out our Facebook page: