Key Points
- Accumulate a diverse portfolio of investment properties.
- A geographically diverse portfolio of different property types helps investors reduce risk, and at the same time maximise profitability.
- Stay under each State's Land Tax free threshold: Knowing the tax-free thresholds of each state means you can reduce your tax burden by buying properties in different cities. A diversified portfolio has clear taxation advantages.
- No one suburb, city or state is always the best place to invest. And each property type (houses, apartments, townhouses etc) has its own unique advantages and disadvantages.
- Houses may perform better in one location while apartments perform better in another.
- Some properties get higher rents and are easier to hold whilst others get lower rents but higher capital growth.
- Smart investors understand that economic conditions differ from city to city, resulting in up and down "cycles" of property activity.
- Property investing is a long term strategy, set your goals and stick to them!
Property investment strategies
The Portfolio Approach
Property is an ideal investment vehicle for people to secure their future – providing it is done correctly. Property investment is NOT a get rich quick scheme.
Most property investors stop investing after only 1 or 2 properties because they lack the time, expertise, support and long term planning required to achieve a significant property portfolio. Australian Residential educates and assists investors to continue to invest and strategically build a balanced portfolio of different types of property in different locations – and to hold onto that portfolio over the long term.
The above model is a conservative property portfolio approach. Many investors achieve multiples of the above and most are not in high income brackets. Pease remember “it is not how much you earn, but what you do with what you earn that counts in your working life.” Above all it is important to set goals that you are comfortable with achieving in the long term, whether that is 1 or 2 properties or 20 properties is up to you. Try to set goals that are achievable and get you out of your ‘comfort zone’ and excite you at the prospect of reaching them.
Australia Residential property strategists are active and serious investors themselves. We can refer you to financial and property specialists who will suggest general practical strategies and recommend properties to help you build your portfolio. They will work with your accountant, mortgage broker or financial advisor to support you and assist in making the best property decisions for your individual situation.
Disclaimer: The above model and information should not be regarded as a substitute for professional legal, financial or real estate advice. Because every investors needs and financial situations are different, the ideas on this web site are intended as a guide only.