Investment Property – ‘Strategy and Loans’.

There’s a lot to know about investments. Firstly what represents a good investment property and a sustainable ongoing strategy which suits my circumstances.

Find out what may lay ahead for your strategy – To assist to empower you, and help make your ‘Investment Property Journey’ a smooth one we have given the ‘FREE Property Puzzle Quiz’. This quiz is an “your own pace’ way you can consider the possibilities and knowledge involved. Click on the ‘Quiz’ banner to your right here and gain valuable information, all at no cost or obligation to you.

How to choose the best investment loan that meets your needs and goals. A good investment loan can make property investment a much smoother process.

Investment loans vary depending on what you are looking to achieve, and can be either very simple (like your standard home loan), or something more complex that helps you make effective use of tax, gearing and repayments. You can also make good use of loan features such as redraw, offset and additional repayments to help manage your investment loan.


Investing in Property FAQs

Smart property investment can offer a steady ongoing income and/or the potential for capital growth. Traditionally, property investment is considered a good long-term investment strategy.

To give yourself the greatest chance of success and being aware of your options seek out advisers that can help on your journey. The cost that will be involved will be minimal in comparison to the ‘success’ you will enjoy in your strategy results and the security that accompany it.

Seek out advice and form a ‘talent’ bank that supports you.

Put together

  • Accountant (one that is familiar with Investment property)
  • Financial Planner (one that works on ‘Fee for Service’ basis)
  • Solicitor ( That specialises in property law and ownership structures)
  • Property Consultant ( Look at what Gary does and you’ll see what’s really involved)
  • Quantity Surveyor
  • Property Manager (That looks after you by doing the job properly)

What are some of the possible Pitfalls?

To help you achieve an understanding of using property as an investment vehicle and issues that need care below is a FREE e-book. The ‘7 myths of Property investing’ was designed to assist people to have a smooth journey in achieving their property portfolio.


Is Property Investment Easier if I Already Own Property?

If you have equity in any existing property, for example your family home or another investment property, you may be able to use this to increase how much you can borrow and more quickly build a substantial property portfolio. Ultimately it will depend on your personal financial situation and investment goals.

What Costs Are Associated With Purchasing an Investment Property?

When buying investment property, there are other costs in addition to the purchase price of the property that you will need to consider. These may include:

  • Building and pest inspections
  • Survey report
  • Strata inspection report
  • Loan application fee
  • Disbursements
  • Lenders Mortgage Insurance
  • Refinancing or switching fees
  • Contingency Buffer

Your mortgage broker can assist you to determine the additional costs that may apply to your situation.

Do I Need a Lot of Flexibility in My Investment Property Loan?

Flexibility in your investment property loan can take many forms, including the ability to make extra repayments, to redraw on your loan, split your loan between a fixed and variable interest rate or even transfer the loan between properties. Some options may be standard and some may cost you money, so you need to be clear about your investment strategy before choosing a suitable investment property loan. Always compare loans with similar features when looking for the right investment loan for your situation, and beware of choosing a loan with costly features you are unlikely to use.

How Will a Mortgage Broker Help?

A good mortgage broker will assist you to find the investment property loan package that is most suitable to achieving your investment goals, working closely with your accountant and/or financial planner. With access to investment property loans from a large range of banks and lenders, your mortgage broker will save you time and money.

How Can I Pay My Investment Property Loan Off Faster?

If your investment strategy calls for you to pay out your investment property loan quickly, there are a number of approaches you can take, including:

  • Dividing your minimum monthly repayment into two and paying this amount fortnightly, or dividing by four and paying weekly; this effectively increases the amount your repay every month
  • Making both consistent and ad-hoc additional repayments
  • Maintaining a higher repayment amount if interest rates fall

Interest-Only Repayment Options on Investment Property Loans

Interest-only loans suit investors who are focused on achieving capital growth in the short to medium term, and often go hand-in-hand with negative gearing. Interest-only loans will have lower repayments than a principal and interest loan and may be available as a fixed rate or a variable rate loan product. Interest-only loans may work to reduce your total outgoings and improve your cash flow.

Paying Interest in Advance

Paying interest in advance on your investment property loan works by paying the interest you will accrue over the next 12 months in one lump sum before it is actually charged. This allows you to claim the costs against your tax a year earlier than you would normally be able to. Generally available on fixed rate investment loans, you may also benefit from a discount if you pay the interest in advance.

Borrowing Against Superannuation

More Australian investors are considering Self Managed Super Funds (SMSF) as a way to protect and grow their retirement wealth. Investing through your SMSF may be a tax effective way for you to borrow to invest in residential or commercial property. As any income from the investment property, including capital gains, will be taxed at concessional rates, you could save money in the long run. Again your advisors are the ones to help form your strategy here so you are in an informed plan.

The Next step

There are many parts of the process, and much to know. Every step is important and has its place. Our clients that have followed our process, used our professional help have given themselves the greatest chance of hearing the words that we are all after “CONGRATULATIONS, YOUR INVESTMENT HOME LOAN IS APPROVED’.

Call us now, and find out  Where to from here.