How to secure an investment property

New investment property practices are designed to shift traditional thinking into contemporary opportunities before market regulations change.

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Collaborating with family, friends and even strangers could soon become the preferred way to secure an investment property.

 

We’re a far cry from the days where we could purchase a home after just a few years of working.

Sky-rocketing living costs and the anticipation of an impending property market overhaul, has meant we need to think differently.

Recognising strategies employed in international markets helps us identify best practice methodologies to consider in our own backyard.

Family pooling is one such strategy setting precedence in China.

A remarkable 70 per cent of millennials in China and 46 per cent in Mexico are home owners, which is a stark comparison to Australia’s 28 per cent.

This is the world’s most successful approach to creating home ownership at a young age, generating significant opportunities to create wealth.

In addition to family members pooling their resources, this concept can extend to friends, even strangers, using the approach of combining smaller deposits and increasing borrowing power.

The first property doesn’t even have to be a first home, as traditionally encouraged.

The longstanding practice of investing away from your home town has seen a significant swing and is becoming a popular investment strategy.

You may love living and working in inner city Sydney or Melbourne, but your money might be better invested elsewhere where it is more affordable and has good capital growth potential.

By understanding the overhaul of regulatory changes coming soon to the property market, investors can protect themselves through a host of low risk strategies such as locking in current capital gains tax, so they can still build wealth.

Whichever strategy best suits your circumstances, it’s important to know there are viable, low risk options out there to help you achieve wealth in the property market.

Here’s four of the most popular investment strategies for wealth creation using property

1. Collaborate with family and friends, or via crowd funding. This increases borrowing power without individually having the full deposit.

2. Renovate with ‘home-hopping’ – increase potential rental return on your current home with smart renovation, add value and use the equity for your next home. Creating a rental property from your home.

3. Rentvest by living in an area you love, but investing in an affordable area with potential for growth, that may be a few hours away or even interstate.

4. Grandfather current lending, tax and superannuation policies before significant changes.

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