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Property investment
Why Invest in Property?
 Investing in property can be highly profitable. Investment provides a more secure future for you and your family. In order to maximise your returns it is essential that you are correctly informed and guided by a qualified agent.
Wealth is not necessarily determined by how much money you earn, but by what you do with it. With the correct guidance, investing in property can provide a secure future, without the need to invest a fortune each week.
Have you ever thought, "I wish I bought a property in (suburb) years ago"? Property increases in value over time so your initial purchase should be a wise one. Try increasing your portfolio as often as possible and hold on to your investments for as long as possible.
Benefits of property investment include:
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Tax savings
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Viewing your tangible investment
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Controlling what happens to it
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Relative stability of investment (while shares fluctuate in value)
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Use of the equity to increase your portfolio
Where To Invest
 If you choose to invest in residential property, we recommend that you research the areas of interest to you. You may prefer to employ the services of an agent who already has this market knowledge.
The two things to consider when choosing a property for the purpose of generating wealth are the rent return and the capital growth. Many properties may offer good rent return but may not have high capital growth potential. The reverse can also be true.
The following features should be considered when purchasing an investment property as they help to attract tenants as quickly as possible.
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Located close to amenities (schools, shops, transport)
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Plenty of storage (robes, linen cupboards etc...)
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Adequate security (window locks, dead locks, alarms etc...)
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Additional comforts (heating, dishwasher etc...)
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Low maintenance gardens
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Secure parking facilities
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And some further advice:
If you purchase a property and plan refurbishment, it is wise to speak to an agent who can advise you of the potential extra income this may generate. Ensure your new property is of a high standard and that it is maintained to this standard. This will attract a better tenant and provide you with a better return. High standards also make it easier for you to borrow against the property to increase your investment portfolio.
For more information on purchasing an investment property, please contact a member of the Watson Real Estate team. We will be happy to assist with your enquiries.
How Should I Fund Investment?
 If you have equity in your home, you may be able to use this to purchase a property, instead of using a cash deposit. In this situation, as your equity grows, so can your investment portfolio. These days there are a wide variety of loan options available. It is recommended that you consult with a mortgage broker to discuss which one best suits you.
A principal and interest loan allows you to pay additional amounts off the principal sum. This is often used to finance personal property acquisition. With principal and interest loans, you may be vulnerable to interest rate fluctuations, but you can pay off your home quicker. For investment properties, an interest only loan is often recommended. This loan only requires you to pay the interest and the interest rate may be fixed for a longer period.
Another option to consider is splitting your loan.
As mentioned, investors are advised to consult with a mortgage broker. They have access to loan options offered by all financial institutions and can therefore find the one that best suits your situation. This service is free and their industry knowledge can save you a substantial amount of money in the long term.
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