BENEFITS OF INVESTING IN PROPERTY

Property is a solid and safe investment option for many of our clients and may be combined with other investment options. We view property as an essential component of any wealth creation portfolio.

There area number of reasons to purchase an investment property, the following is what we have identified as the major advantages.

CAPITAL GROWTH

Historically, Australian property has enjoyed consistent growth and it has been identified that the median house price in Australia has doubled every seven to ten years on average over the last 40 years. Allowing for the peaks and troughs in the property cycle of real estate values, the underlying trend shows consistently steady growth.

Investment property has the ability to produce capital growth together with an additional weekly income stream, hence resulting in the opportunity to acquire a positive cash flow property.

POPULATION GROWTH

Australia’s estimated resident population at 30 June 2012 was 22.6 million. According to the Australian Bureau of Statistics, Australia’s population is projected to increase to between 30.9 and 42.5 million people by 2056.

As a result it appears likely that property demand will increase in the future and coupled with the current shortage of property available, it is also likely that there will be pressure to increase both rents and property prices.

RENTAL INCOME

The vacancy rates nationally have been declining over the last number of years and in 2012 it was 2.2%. Several of our researched locations have vacancy rates as low as 0.8%.

The increasing population, demand for housing and the declining household size is estimated to generate demand for an additional 620,000 households before 2030. This expanding demand will continue to push up property prices and rental income. Additionally as our properties are new, generally tenants are willing to pay a premium rental for a new property.

DEGREE OF CONTROL

The Investor has the control to choose an area/region that has been heavily researched by Property Wealth Network. Through the assessment of quantitative data the investor can be informed of the potential opportunities in areas by understanding the factors that drive capital growth and strong rental yields.

GREATER SECURITY

Residential property offers the security of ‘bricks and mortar’ compared to the fluctuating values of shares and commodities. Property Wealth Network views residential property as a stable and passive asset class that requires very little management, as opposed to negotiating the complex and volatile landscape of the share market.

Our client’s decision to purchase has been made based on extensive research. This research is based on past property performance, an examination of current and future trends and predictions and reviewing several economic drivers – these include Government investment in infrastructure, population growth, current rental yields and vacancy rates. This quantitative data gives us the comfort and security of purchasing in a region that possesses strong potentials for capital growth.

TAX ADVANTAGES

Investment property is an asset class thatoffers significant tax advantages through negative gearing together with depreciation.

Property Wealth Network’s focus is on selling brand new properties that allow the highest range of Tax Deductions, increasing our clients level of cash flow weekly.

INTEREST RATES

In the last few years our clients have taken advantage of the lower interest rates. This has resulted in greater weekly cash returns from their property investment and enabled them to expand their property portfolio sooner, due to their ability to finance their investments. The generation of additional funds and available equity allows clients the opportunity to acquire additional properties.

LEVERAGE

One of the most significant advantages of property investment is the ability to use an existing property as security to borrow additional funds within the property. These additional funds are known as equity (this is the difference between the market value of the property and the money owed to the lender).

Investors can utilise their existing equity and use it for the deposit, stamp duty, legal fees and settlement costs resulting in the acquisition of an asset class with minimal to no reduction to their current bank balance.