Investing in property
VICKI HOLDER consults the property investment experts on where to buy, what to look for and the potential pitfalls.
Monday, June 2nd 2003, 11:21PM
by Vicki Holder
Body1: Deciding what to buy when investing in the residential property market is inevitably a trade-off between a property that earns a high rental return and one that provides better-than-average capital gain. The ultimate is to attain both from the same property.
But what you buy depends on how serious you are about the business of investing. Do you simply want a property to enjoy for your own personal occupation, or are you prepared to actively take risks to help build your wealth more quickly?
Kieran Trass, of Hybrid Property Consulting, says if you are a serious property investor you need to pay close attention to balancing cashflow and equity if you wish to stay permanently in a position to buy more property.
"Whether you actually buy any more property is irrelevant, but it is critical that you are ready financially to buy if you want to," he says.
However, if your resources are relatively limited, or you are contemplating your first investment, most experts recommend you consider a property that provides a positive cashflow, before any tax benefits kick in.
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