Reasons for investing in property

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Reasons for investing in property

Post  lawrence watson on Tue Jan 24, 2012 9:46 pm

There are a number of compelling reasons to invest in property, both commercial and residential. If you've done it before you already know many of the benefits. For the not-so-experienced, here are some top-line property investment advantages in a nutshell:

Negative gearing
When the cost of owning an investment property is more than the income it earns, you can negatively gear and receive tax benefits. Talk with your financial advisor to see how this can work for you.

It's popular with investors as you can deduct the non capital cost of owning a property from your overall income. The largest amount is normally the interest, however, you can also claim other costs such as repairs and management fees.

The benefits of negative gearing only kick in when the property is earning income.

Capital growth
One of the main reasons to invest in property is for capital growth. Yes, you'll pay capital gains on the increased value of the property when you sell, but the tax benefits along the way can be quite significant. Remember, your principle place of residence is tax free*.

The taxation position described is a general statement and should only be used as a guide. It does not constitute tax advice and is based on current tax laws and their interpretation.

Rental income returns
The rental market may change over the years, but generally, property is a reliable investment. Whenever your property is being rented, you're receiving an income.

Use your equity
If you already own your own home (or another property) you can use the equity in that property to help finance your investment. We may then be able to lend you 100% of the loan amount as your home can be used as security.


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lawrence watson

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