Investing in property
When starting to invest in property it’s important to be clear on your property investment strategy. Are you going for high rental returns for the short term or are you going for long term capital growth?
If you’re thinking about investing in property for the first time, it’s important to seek professional advice. One of our financial planners will be able to help. Meet with a financial adviser. 1
Investing in property has several benefits, including the potential to:
- Generate capital growth – increase in the value of your property over time
- Generate rental income and yield – annual rental income less any costs divided by the purchase price of the property
- Gain potential tax advantages associated with negative gearing – with negative gearing you can deduct the costs of owning your investment property from your overall income, reducing your tax bill.
What should I think about?
If you’ve decided that investing in property is the way to go, it’s important to recognise that the way you might choose an investment property is a little different to how you would choose your own home.
These are some points to consider:
- Buy a property that fits your strategy, e.g. are you wanting to negatively gear? Refer to our article on Strategies for property investors for more information.
- Understand all the expenses including, stamp duty, strata levies, council and water rates, real estate commission.
- Consider getting Landlord Building and Contents Insurance 2 to cover you if the unexpected happens.
- Plan - give your tenants a suitable length of lease and make sure you can cover repayments if the property is unrented for a period of time.
- Choose a loan that suits you and consider an interest only option as it will lower repayments and increase your cash flow.
- Keep up to date on the latest property trends.
Things you should know
- The information contained within this page is general in nature. It serves as a guide only and does not take into account your personal financial needs. Before you act on this information you should seek independent legal and financial advice. Westpac does not warrant the accuracy or appropriateness of this information.
- 1. Westpac Financial Planners are representatives of Westpac Banking Corporation, AFSL No 233714.
- 2. The information provided in this page is general in nature and serves as a guide only. It does not take into account your personal financial circumstances and needs. Before deciding to acquire a financial product please read the relevant Product Disclosure Statement which is available from our branches or from the Issuer of:
- Income Protection Insurance is Westpac Life Insurance Services Limited (ABN 31 003 149 157 AFSL No. 233728)
- Mortgage Secure Insurance is Westpac Life Insurance Services Limited ABN 31 003 149 157 (Westpac Life) and distributed by Westpac Banking Corporation ABN 33 007 457 141
- Landlord Insurance is Westpac General Insurance Limited ABN 99 003 719 319 (WGIL) and distributed by Westpac Banking Corporation ABN 33 007 457 141 (the Bank)
- Life Insurance is Westpac Life Insurance Services Limited (ABN 31 003 149 157 AFSL No. 233728).