Saturday, November 29, 2014

Brand New Real Estate for Brisbane Property Speculators

By Colin James


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

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

Holder asserts that hesitation is a big element that holds many potential investors in real estate back, in particular there is doubt around repairing and maintenance costs,"Buying a rental property in a high demand area more or less guarantees low vacancy rates, however the aptitude for high mend costs on existing housing stock is the large unknown. "

"Making a capital gain is a driving factor for some investors, who propose to retire off the proceeds of a rental property that they have paid down 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 lots of the risk 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 course of action. They are very surprised at this analysis, given the increases anticipated 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 dreadful inroads into any increase in property value. Holder says that having a spotlight on rental yield from house and land packages shifts the point of view away from capital gain.

An annual rental yield of 6 % is typical for the properties that Holder presents to her clients. Holder says that a 20 to 25 percent deposit will be enough to get a foot in the door, with many properties being paid off during the course of 20- 25 years. But Holder asserts that with rental yields providing a competitive investment, plenty 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 very low risk by our clients," announces Holder.




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