Property Investment Strategies In Australia that anyone can use now !
There are many ways of investing in property and increasing your wealth.
Here are a few easy to implement property investment strategies that can work in Australia.
There is NO investment strategy that is better than another all the time.
There are always outliers.
See more at the end of this article.
Depending on the different circumstances you may favour one method over another based on a variety of factors.
This is a broad over view that possible investors can easily understand.
Investors can then choose which strategies they like and suit their personal situation.
Home Ownership would have to be the most common investment strategy in Australia with around 60% of households owning their own home which is high compared to the rest of the world.
The strategy is purely buying your own home and living in it.
Over time you might do minor renovations to improve the home’s value but the bonus is the chance of the market rising and pushing your homes value higher.
We are not normally generating any revenue from the home but just sitting on it to wait for it to increase in value which gives us greater equity and leverage later.
This is the way many people first start their journey on the property ladder.
They might not to have started with their dream home but by starting at the lower end of the market they at least get a foothold.
Buy and Hold is the standard purchase and rent with the increase in inequity associated with it.
Positive Cash Flow – is where you purchase a property primarily for its income generating purposes from rent.
The property will(most of the time)go up in value as well but that’s more a side effect to the main purpose of the property which is to generate you a passive income.
Passive income property or positive cash flow property works because the rental income coming in from the property is greater than the expenses going out.
Negative Gearing – This involves purchasing a property where the rental income is not as large as the expenses.
This does give us some tax advantages and we suggest mixing both positive and negative geared assets.
Property Investment Strategies
Renovate To Flip for profit.
Briefly, the aim is to renovate property that is run down, increase its value and then flip it for a profit.
Many tv shows that are very popular like The Block etc use this investment model.
Renovate And Hold (To Rent).
Subdivision-A parcel of land (which might have a property on it) which is then divided up either by private sales of through a contra deal with a developer.
Dual Occupancy-For example, this can be done through renting out a granny flat.
It can also be done through converting a single house into two units.
This can be an excellent way to increase the rental yield of a property and can be a very profitable strategy.
Duplex Or Second Dwelling
This is building two properties on one block of land.
And in many cases when people say dual occupancy they really mean converting existing houses into two incomes streams whereas the duplex is designed from the ground up to be two separate properties.
Development, Town Houses, Unit Blocks-Villas,Town houses, villas,high rises and until etc.
This is a large scale renovations, full-scale development where a lot of building work needs to go into the project.
They are often generally riskier ventures but can be extremely profitable.
Property Syndicates-Purchase into a property syndicate or the consumer purchases into a property fund which then invest for you.
This is a great way to invest and can be good if you don’t have the full deposit to go purchase a property by yourself.
Due diligence must be carried out of course with each fund.
Partnerships-These might be a great way to lower a deposit.
The problems are the full liability of the loan will rest with you if your partner is having financial or “ethical” problems.
Commercial Real Estate-Often requires a larger deposit than residential which is of course built around variability with mortgage brokers.
Commercial property can be great because the rental yields can often be higher than the residential properties in the area and the tenants in commercial properties will generally pay the majority of the ongoing expenses (maintenance, council rates etc).
House and Land Packages-This is very popular at the moment because a federal govt assistance and tax breaks.
We believe the best strategy for long term wealth, is investing in new properties Australia wide.
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Property Investment Strategies