Investment Property
Discover the 3 motives of investing!
Here's what you need to know:-
To be a successful investor it is crucial that you understand why you are investing. In other words, know what you what to get out of it before you get into it. This is also known as an Exit Strategy.
This knowledge empowers the investor to make educated decisions - maximising the return and minimising the risk.
Three Investment Motives
People generally invest for one of three reasons. They want to make some quick cash, they want to purchase a property and hold onto it for future returns, or they want to generate immediate cash flow. If you fit into either of these categories, read on to find out how your investment motive determines the characteristics of your investment property.
- want quick cash
- Buy a property with the intention to sell it within 12 months
- Ensure the property has the potential to have value added to it
- Ensure the property has potential for short-term capital growth
- If you want to buy a property & hold onto it
- Buy a property with the intention to keep the property
- Potential for long term capital growth
- It may be negatively geared and often a tax deduction
- If you want to generate cash flow
- Buy a property with the intention to keep the property
- Ensure that it is positively geared to generate passive income
- It may have potential for capital growth, but not necessarily
Your Investment Motive affects your Investment...
The three different investment motives outlined above need to be taken into account when considering the following:
- Ownership - whose name will the property be in?
- Asset Protection - will a person, a partnership, a trust or a company own it?
- Taxation Issues - is it structured to give the greatest return?
- Investment Plan - how many investments are desired over what period of time?
- Lending Structure - do you want the lender to have security over the family home? Do you want all of your investment properties with one lender?
Where from here?
Purchasing an investment property is usually much easier than people think, even easier than buying the family home. And more often than not, you won't have to use money from your own pocket to purchase an investment property!
Go Loans can structure loans according to your investment motive. Give us a call to discuss your options.
Take advantage of our personal knowledge and investment experience - work with a team that lives what they teach!
RP Data
The brokers at Go Loans have a relationship with RP Data. RP Data is Australia's number 1 property information and analytics provider to Real Estate, Finance, Government and Consumers.
With this connection, Go Loans can provide you up to date reports on not only your home and your investment properties - but also on properties and areas that you are looking to purchase. Contact us today to find out more.
If you are a property investor or simply looking at purchasing your first investment property, contact us today to find out more