- PASSIVE APPRECIATION: This occurs when you purchase a well-positioned property with a good location and it increases in value along with the general property market over time. History has shown that good properties in Australia double in value every 7-10 years. Hence property is best viewed as a long-term investment.
- ACTIVE APPRECIATION: This happens when you take an action to increase the property's value. Maybe you add a granny flat or redevelop it in some way.
- RENTAL RETURN: This is the most common source of return on investment, since it provides cash flow. But it is important not to place too much emphasis on rentals, remembering your overall investment return.
- TAX BENEFITS: Property is probably the best investment for tax benefits due to negative gearing and depreciation allowances.
It is important to keep all four of the income producing qualities in mind when investing in property. One reason is that well located residential properties have inherently high growth rates. This means that the rental returns are always going to be low yielding on this type of property.
Real estate investment should be viewed as a long term investment for this very reason, but, at the same time, it is one of the most secure.
If you have a real estate need or question, feel free to call me:
Noel Thompson, Principal Professionals Logan Lifestyles at either:
- Waterford 3299 7733
- Browns Plains 3800 4000
- Springwood 3808 5544
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