These are 10 of the traditionally pre-eminent guises of investment risk, but specifically as they apply to Australian property investors.
Archive for the 'Investment Basics' Category
Most people who have any interest in the housing market will appreciate that the performance of home values can vary broadly based on a range of factors. Geographically, for example, we have seen Darwin values rise by more than 8% over the first eight months of the year, while Melbourne values have fallen by 2.6% over the same time frame. Across the broad housing types there are differences as well, with unit markets generally showing stronger conditions compared with the detached housing market.
Most investors lose money by making a number of poor investment decisions, swayed by smooth talking salespeople and too good to be true purchasing schemes. Read on to find out what these include.
It might just be a coincidence, but this week is the 13th one of the year and last night I delivered my 13th presentation for 2012. The first quarter of the year is usually much quieter for such proclamations than later months, so either this year will be full-on speech wise or things are just topsy-turvy. I hope the former, as our bank account can do with the speaker fees!
When I was growing up, I was taught at a very young age that saving money is very important. I even had a Commonwealth Bank Dolomite account where I could see my savings increase over a number of years. It was 1989 and I clearly remember the day my Dolomite account reached $10, wow what a milestone. I could buy 2 packet of chips, two chocolate bars and 100 packets of Wizz-Fizz. Saving really does work!
Too many property investors are funding the lifestyle of their tenants, rather than using property as a vehicle to grow their wealth and improve their own lifestyle. Kevin Lee from Smart Property Adviser said the outdated strategy of negatively gearing property simply allowed tenants to live in a property for less than its true cost and limited the ability of investors to buy more than one investment property.
Property investing is one of the best wealth creation strategies to implement. Returns are exceptional and financial freedom is achievable in a relatively short period of time. However, a number of problems arise when property is treated like an investment.
Many people treat property investment like a fairytale. You know how it goes… pretty girl marries charming prince, they live in a castle and it’s ‘happily ever after’.
There are some kids that know the value of the piggy bank. They put money away assiduously, work out how best to put it to good use and use it wisely. These are the kids that will grow up to be people who build good portfolios.
With over 1.4 million property investors in Australia, many of us already realise it’s not a good idea to rely on the pension, or the government when entering retirement age.
Justin Wood is the director of Property Toolbox Australia, a successful investor and a leading expert in wealth creation through property, businesses and commodities.
Lillian is a successful property investor and business owner with over 7 years experience in the banking and finance industry.
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