Mark Hay Realty Group

This Weeks Episode of Home in WA

Contact:
Mark Hay

Email:
markh@markhay.com.au

Website:
http://www.markhay.com.au/

Phone:
(08) 9225 7000

Fax:
(08) 9225 7777

Mobile:
0418 953 742

Address:
28/118 Royal Street
East Perth WA 6004

Entering the property market can sometimes be fraught with pitfalls and getting some good advice should be your first step.  Mark Hay from Mark Hay Realty Group had some good advice for first-time investors.

“While your own neighbourhood may be a wonderful place to secure your first home or raise a family, you should be purchasing in a suburb because it will give you strong capital and/or rental returns, not because you are familiar and comfortable with the area so not all suburbs are prime investment opportunities.   It also makes sense to spread your risk and stock your portfolio with a varied range of localities and types of properties.

Another common mistake is to overlook the capital growth of the property in favour of the rental return.  Provided the investment is held over the long term, you will find capital growth will be a far more powerful wealth creating tool, remembering only 50% of the gain is ever taxable and you can continually borrow against the increased growth to fund further investments.

Be very wary that all the fundamentals stack up on properties you purchase off-plan, be very careful all specifications, sizes, locations etc are most importantly checked and the contract documentation via your solicitor, finally plan your cash flow requirements for deposits, stamp duty and progress payments.

Investors who entered the market over the last two years have witnessed healthy gains in the value of their property, but please remember property is long term and the costs of entering property can be quite high and if you were to sell within 12 months of purchasing you will also be liable to have all profits taxable.”