It is the age old question – what is the best investment option? Investors have long debated which investments yield the best returns. In terms of safety and consistency, it is difficult to argue against investing in property, but what other factors make it such a good choice?
Here are the top five reasons why property is the best investment option:
1 – Property Is One Of The Safest Ways To Invest
Property is considered as one of the safest and most consistent investment options. There is always a need for property as people will always need a place to live. As a tangible asset, its value is determined by what it is objectively, not by what value people attribute to it. At AllianceCorp, we tend to leverage the ‘buy-and-hold’ investment strategy as it provides a low-risk, high return framework over an extended period of time.
2- Government Incentives Help You Pay Less Tax
One of the biggest incentives for investing in property is the ability to minimise your tax. Many of the expenses involved in an investment property are tax deductible, including borrowing expenses, interest, maintenance and agent fees. As long as the loan costs are greater than the rental income, the Australian Taxation Office will allow investors to offset the loss against their income. This strategy, known as negative gearing, is often considered more of a tax strategy than an investment one.
3- Pay Off The Home Loan Sooner
For many homeowners it may be many years before they actually own their home which can put a lot of pressure on their finances. Mortgage repayments can continue for ten to twenty years or more if they do not find a faster way to pay off their home. Building equity in investment properties can be used in the future to pay down the mortgage sooner.
4- Regular Income Stream
Rental income grows over time to eventually cover all your costs and generate
additional income streams. Creating multiple streams of income is the most effective way to achieve long term financial security. However, investing in real estate does not have to bring you profit in the long term only. In fact, most investors buy investment properties to make money in the short term, through positive cash flow.
5- Accessible To Everyone
Unlike the share markets where there are complicated terminologies you need
to get your head around, real estate is relatively simple. You know what a house,
unit or a townhouse is and you don’t need a 60-page prospectus to tell you all
about it.
At the end of the day as long as people need property, investing in it will always be a safe and excellent investment option.
If you’re interested in learning more about property and receiving a wealth creation strategy tailored to YOU, simply fill out the form below for a FREE, no obligation strategy session with one of our Senior Property Wealth Planners today!