Category Archives: Strategies

Create the Best Impression with Floor Mats

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Whether you are planning to make your home stand out from the rest in a bid to sell it or you simply want your property to appear to the world in the best possible condition, there are a number of ways to make it more beautiful. And the good news for anyone who is on a bit of a tight budget is that you don’t have to pay a small fortune to make a big difference.

Can I Live in My Investment Property?

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A common question about owning investment property is whether an owner can live in their property or not.  The answer is yes, you can live in any property that you own.  However, it is important to realise that once you move into your property, it becomes your Principle Place of Residence (PPOR).

Property Versus Shares – Which is Better?

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This is not a property investing tip, but it is a topic you will probably have to consider at some stage, if you haven’t already.

For personal investing, the decision as to whether to put your hard earned cash in property or in shares is always hotly debated.

As someone who has put their money in both property and shares, I think the decision as to whether to invest in one or the other (or both) comes down to your level of acceptable risk and the time frame of investment.

Energy-Efficient Investments are Hot Property

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If you are just considering investing or are already a seasoned property investor, improving the energy efficiency of your buildings can lead to benefits in the long-term according to the property news experts at Zoopla.

Let’s face it, the world is going green, but can you get a better return on your real estate investment by improving energy efficiency?

Is Property a Good Investment?

Is property, such as land, a good investment?

The question of “is property a good investment” does not have a simple yes or no answer.  A better question to ask might be, is rental property a good investment?

Property is simply an investment vehicle that can give good returns if you do your research.  It can also be a horrible investment if you get it wrong.

For a property to be an investment, it generally means that you will not live in it but will rent it out to other people.  For the sake of this article, we will be referring to residential investment property.

How to Find Tenants for your Commerical Property (Part 2)

Finding Tenants for Commercial Property

..Continued from Part 1 (How to Find Commercial Tenants)

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You can place advertisements in various local publications and on boards around town when you are considering how to find tenants.  Of course, using a commercial real estate agent is one way of getting the word out that your property is available for lease.  This is definately wise when you are trying to fill a large or multiple spaces.

How to Find Tenants for your Commercial Property (Part 1)

Finding Tenants for Commercial Property

Do you own office space?

Maybe a retail shop or a warehouse?

When looking at how to find tenants for your commercial investment property you need to think in the long term. Making in-roads with companies that look to have the potential for expansion as well as a long-term goals for the area help ensure the safety of your investment and the security of your overall income.

To Buy a Home or Rent a Home

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An age old question for real estate investors is: Do I buy my own home to live in, or do I rent a home?

There is no right or wrong answer to this question, it is more a matter of where you are in your life and what your financial goals are.

Depending on where you live and the current state of the property market, renting can be a cheaper short term option.

Renting is very suited to the younger generation as they are just starting out in their careers and haven’t had time to save for house deposit.

Investing in Residential Property Versus Commercial Property

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There are substantial differences between investing in residential and commercial property, but it is a good idea to have a mix of both as you grow your property portfolio.  

Residential properties are the ones which are mainly for people to live in and commercial properties are the ones which are intended for businesses to operate from. Though these two are totally different kinds of properties, determining the affordability is important for both of these types.

It is important for you to ask yourself and maybe a financial consultant “I want to buy a new house how much can I afford” in order to decide on your affordability.

Renovating for Capital Gain

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Renovating a property is a popular past time, especially for owner occupiers.

It is also popular for investors as making a property more liveable and with extra facilities can add value and command a higher rent.

In this article we will look at renovating for capital gain, but under the assumptions that we have a house that will be rented to tenants for a few years and therefore we will not sell it off after the renovations.

NSW to Remove Stamp Duty Discount

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The new Liberal government of NSW, led by Premier Barry O’Farrell, recently released their first budget for the state of NSW.  As part of cutting spending to help fund long promised infrastructure, the state treasurer Mike Baird has ditched stamp duty concessions for first home buyers of established properties.

Flipping Real Estate

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In general, flipping is buying something and reselling it for a higher value.  When it comes to real estate, this is also true and normally requires a renovation to get the higher resale price.

If you don’t quite follow, let me break it down:

 

  1. You purchase a dumpy or run-down property
  2. You fix it up, renovate and improve it
  3. You put it back on the market after fixing up for a higher value (the flip).

The idea is to make a good profit in a relatively short period of time.

What are Investment Wraps?

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The term wrap refers to a property investor who buys a property, using a mortgage and then on-sells the property to someone else and then providing vendor finance to the new buyer.

Sound confusing?

It might at first, but it’s not that complex of a strategy.  You see, some people out there want to buy a property to live in but for whatever reason, cannot secure finance for themselves.  They might be a former bankrupt or just have not saved enough deposit.  The reason isn’t too important.

How Much Property Do I Need to Retire With?

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If share markets make you nervous with their volatility, then investing in property is a valid alternative for building a retirement income.

And let’s face it, money in the bank experiences very little growth after you take into account inflation and income taxes.

But what are we aiming for when building a property portfolio?

It is important to set goals when investing in property and then choose a proven strategy that will help us achieve those goals.

3 Ways to Increase Your Rental Return on a Residential Property

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While it would be nice to charge our tenants whatever we like for renting our precious investment property, in reality we can only charge what the market is willing to pay or risk getting nothing at all.  Since we are professional investors, getting nothing at all is not really an option.

Of course, when you first start looking for an investment property it is wise to find one that has a good rental return as well as good prospects for capital growth.  However, once you’ve purchased that property, you will be at the mercy of the market as to how much rent you will get.

Investing for Positive Cash Flow

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Investing for positive cash flow (also known as positive gearing) means buying an investment property that has a high enough rental return in order to cover all holding expenses and still have some cash left over.

This is easier said than done.

In most capital cities, rental yields average around 5%.  Therefore if you are paying 7% on your mortgage and 1% for other expenses (such as insurances, council fees, body corporation fees etc) you are making a 5% minus 8% equals -3% cash loss.  That is negative cash flow and you have to put in your own money every month to hold onto that property.

Investing in Boom Towns

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A boom town is traditionally a low demand area that has been revived by a major industry.  Examples of this are a regional town that has had a new mining operation started up which creates a whole lot of new job opportunities.

Other types of industries that can dramatically affect the demand of property in the area are Tourism, Government Departments, Military Bases or even Technology companies (think Silicon Valley).  It’s also possible that a town starts to become more popular due to new infrastructure (such as a train line or highway) that makes accessing it quicker and easier; however this factor by itself rarely creates the start of a boom.

Investing in Real Estate – A How To

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If you are just getting started with real estate investing, there are some important things you should consider before taking the big leap.

Buying a property can be a daunting idea when you realise all of the things that need to be done.  Looking, researching, negotiating, losing out to someone else, getting finance organised, getting legal advice, getting inspections done (building, pest, strata etc) and finally, draining your bank account to finalise the purchase!

Here we will discuss a few things to think about to help lessen the burden.

Buying Investment Property for Tax Advantages

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If you are lucky enough to live in a country which allows negative gearing, then this can be a great incentive to buy property as an investment.

However, you should never look to buy a property simply because it will reduce your tax bill.  Negative gearing only helps to lessen the cash loss that you make.

If you buy a property and it costs you $100 a week to hold, that is a loss, also known as negative cash flow.

You would only accept this loss if the future capital gains would cover the loss and then some!

Property Investing for Capital Growth

Investing for Capital Growth

Capital Growth which is also called Asset Appreciation, is the main aim for most property investors.  Capital growth is when the value of your property increases over time.

But, how to achieve it?

Well, it’s not that difficult as property is a popular investment class which has shown to move up over the long term.  However, it is not enough to just go out and buy any old property.