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Astute East Brisbane's Finance Insights

Drawing on his industry experience, Tony Duncan shares his thoughts on industry changes, home loan requirements and a number of important areas to consider when planning your first home purchase or your next property investment. 

Investment Property? It’s Easier Than You Think!

Writer's picture: Steve DartSteve Dart

Updated: Jan 29

Getting started in property investment might seem daunting, but with the right approach and guidance, it can be a straightforward path to building wealth. Let's break down the key considerations to help you make informed decisions about your investment journey.


Starting Your Investment Journey


The first step in property investment isn't actually about property at all – it's about understanding your financial position and goals. Here's how to create a solid foundation:


1. Assess your current financial situation, including savings, income, and existing debts

2. Determine your borrowing capacity by speaking with financial professionals

3. Define your investment goals: Are you looking for rental income, capital growth, or both?

4. Consider your risk tolerance and investment timeline


Many first-time investors get caught up in property hunting before establishing these fundamentals. Working with a financial advisor or mortgage broker early in the process can help you understand your options and create a structure that aligns with your goals.


Beyond Interest Rates: The Complete Financial Picture


While everyone focuses on getting the lowest interest rate – and yes, it's important – there are other crucial factors to consider:


Day-to-Day Functionality

- Offset accounts can help reduce interest while maintaining access to your funds

- Redraw facilities provide flexibility for future investments or renovations

- Split loan options allow you to manage investment and personal expenses separately

- Online banking features and property management tools can simplify record-keeping


Remember, the cheapest loan isn't always the best loan. Consider how the loan structure will work with your overall investment strategy and lifestyle. A slightly higher interest rate might be worth paying if the loan features better suit your needs.


Working With Your Accountant


Your accountant should be one of your closest allies in property investment. They can help you:


- Structure your investment to maximise tax benefits

- Understand depreciation and how to claim it

- Plan for capital gains tax implications

- Set up proper record-keeping systems

- Review your investment strategy annually


Before making any major decisions, consult with your accountant to ensure your investment approach aligns with your tax strategy. They can often suggest structures or approaches you might not have considered.


Pro Tips for Success


1. Research is key: Understand the market where you're planning to invest. Look at historical growth, rental yields, and development plans.


2. Build your team: Beyond your accountant, you'll need:

   - A reliable mortgage broker

   - A skilled property manager

   - A good real estate lawyer

   - A qualified property inspector


3. Consider the long game: Property investment is typically a long-term strategy. Don't get caught up in trying to time the market perfectly.


4. Budget for the unexpected: Maintain a financial buffer for repairs, vacant periods, and interest rate changes.


Remember, successful property investment isn't about getting everything perfect from day one. It's about making informed decisions based on solid research and professional advice, then managing your investment wisely over time.


Next Steps


If you're ready to start your property investment journey:


1. Book an appointment with a financial advisor or mortgage broker.

2. Schedule a meeting with your accountant to discuss structure options.

3. Start researching potential investment areas.

4. Begin building your professional support team.


Property investment doesn't have to be overwhelming. With the right structure, support, and strategy, you can build a successful property portfolio that helps secure your financial future. At Astute East Brisbane, we’d love to help you with that.




 


 

Disclaimer:


Astute Financial Management Pty Ltd | ACN 093 587 010 | Australian Credit Licence 364253 | Davgan Insurance & Wealth Pty. Ltd. T/As Astute East Brisbane Corporate Authorised Representative (425641) of Alliance Wealth Pty Ltd | ABN 93 161 647 007 | AFSL 449221. www.centrepointalliance.com.au/aw | General Insurance provided by Astute Insurance Pty Ltd | ABN 59 622 582 236 | Authorised Representative of Ausure Pty Ltd ABN 94 096 971 854 AFSL 238433. Health Insurance products are underwritten by St Luke’s Medical and Hospital Benefits Association ACN 009 479 618 (St.LukesHealth), a registered private health insurer, [trading as Astute Simplicity Health] and members are introduced by Astute Financial Management Pty Ltd or related entities (collectively known as Astute) for which Astute receives a commission.


General Advice Warning: 


This communication contains general information only and in no way constitutes the provision of professional advice, nor should it be relied on as a substitute for financial, credit, accounting, legal or other professional advice. We have not taken into account your financial situation, investment objectives or particular needs. Before making an investment or financial decision, a person must seek appropriate independent professional advice and also consider whether this information is appropriate to their needs, objectives and circumstances. The author as well as their representatives, agents and employees give no guarantees and make no representations, express or implied, as to the accuracy, currency, completeness or suitability of the information contained in this document. Nor do they accept any liability whatsoever as a result of any information herein being incorrect, incomplete or unsuitable or as a result of a person in any way using or relying on the information herein.

 

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