Thanks to our strong property market and tax concessions for investors, property investment is a popular pastime in Australia. For first time investors it can be hard to know where to start, but it’s worth taking a few things into consideration to get the most out of your first property investment. Read on for Choice Home Loans’ top tips.
Seek out experienced professionals
Property investment can be a complicated process, particularly if you are looking to develop a portfolio of several properties over time, so you will need to enlist the help of legal and finance professionals who are skilled in this area. Accountants, lawyers and a good mortgage broker are essential to ensure you are developing a suitable structure for your investment and getting the most appropriate loan for your needs and goals.
Do your research
The growth potential of the area in which you buy your investment property, and the price you pay for it, can have significant implications to the value of your investment. Before you get to the property shopping stage, make sure you’ve studied literature like industry magazines and property reports, so you know how much prices in your area are growing, and what a fair price should be.
Consider the tax implications
Although it’s unwise to buy an investment property purely for tax reasons, for first time buyers it’s definitely important to factor tax into your property investment strategy. For instance, capital gains tax will apply when you sell your property, while income tax will apply to any rental payments you receive from leasing it. Negative gearing also means you may receive a tax refund from the government if the costs of owning your investment property outweigh the income you receive from it. Please speak to your accountant before making any decisions that may impact your taxation.
Get a quality property manager
A property manager is another make-or-break part of your investment if you are planning to rent out your property. Talk to other investors and find one who comes recommended – you’ll want to look for good value management fees, a strict policy for reviewing tenants, and a good administrative team supporting the manager with day-to-day jobs like collating your strata and water bills and managing maintenance issues.
If you’re thinking of purchasing an investment property, Choice Home Loans can help. Our network of experienced brokers can talk through your goals in detail and help you decide on for a loan that meets your circumstances. Make an appointment online to talk to your local Choice Home Loans broker today.