Sunday 30 November 2014

Brand New Real Estate for Brisbane Property Speculators

By Colin James


(Brisbane) Latest figures for property values in Brisbane City have home owners laughing all the way to the bank, as the statistics prove that property values are on trend to rise by 2.2 percent every year.

Investment property guru Micki Holder says that the projected unusual growth in Queensland real-estate values is inciting many of us to speculate in the property market,"There is a distinct market for speculators wanting to buy quality real estate that may serve as investment property. First time speculators abound, however they have done their homework and there is an expectancy that rental yield will be positive, if not downright competitive. Investing in house and land packages is a highly attractive option. "

Holder says that hesitation is a major factor that holds many potential real estate investors back, in particular there is concern around repairs and maintenance costs,"Buying a rental property in a serious demand area nearly guarantees low vacancy rates, however the aptitude for high mend costs on existing housing stock is the gigantic unknown. "

"Making a capital gain is a driving factor for some investors, who plan to retire off the profits of a rental property that they have cleared over a period of 20 years or so". Holder asserts that good rental yield and capital gains do not always co-exist, however she explains that house and land packages address plenty of the chance factors presented by older housing stock,"Many of our clients come to us for confirmation that purchasing an investment property in a blue chip area of the city is not a financially responsible action to take. They are extraordinarily stunned at this analysis, given the increases expected in capital gain projected over the lifetime of the investment, say 20 years. "

Capital gains tax and the cost of maintaining an older property located in a blue chip area can make serious inroads into any increase in property price. Holder says that having a spotlight on rental yield from house and land packages shifts the perspective away from capital gain.

A yearly rental yield of 6 percent is common for the properties that Holder presents to her clients. Holder says that a 20 to 25 % deposit will be adequate to get a foot in the door, with many properties being paid off during 20- 25 years. Nevertheless Holder asserts that with rental yields providing a competitive investment, many of her clients choose to have a low debt ratio and live off the rental proceeds,"Generating retirement income from a fresh home is viewed as really low-risk by our clients," claims Holder.




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