When it comes to investing, real estate is often regarded as the simplest and safest form of investment, with the common perception – buy property and watch it appreciate.
Though real estate can be a great investment, it is far from simple and not something that should be entered into lightly.
When it comes to investing in real estate, not only do you need a thorough understanding of investment strategies and property, you also need an understanding of the property market that you wish to buy into.
With our head office based in Newstead and a team of investment professionals with an expert understanding of investment properties and strategies within Brisbane, we can help you to understand your options in order to make the investment choice that’s right for you.
The Brisbane Property Market
Brisbane property is booming, with the median house price in Brisbane rising well beyond the average weekly earnings in Queensland over the past two decades. The market has seen a significant spike in housing prices through the early to mid-2000s, as shown in the graph below.
Brisbane Median House Price vs. Average Weekly Earnings
Given the information above, it’s no surprise that you’re considering investing in the Brisbane property market and looking to capitalise on the city’s growth. There is, however, a lot to consider before coming to a decision about your future investment.
Brisbane is a big city, and rapidly expanding, so you need to carefully consider where in the city you might want to purchase property. Generally speaking, the best investment opportunities lie between 7 and 15 kilometres outside of the CBD.
Real estate is a long-term investment, and whether you’re looking to invest in an apartment in Spring Hill, a house in Ashgrove or a property out in Brookfield, you need to consider the long-term implications of this.
With this in mind, our financial advisors who are well-versed in the Brisbane property market, can provide you with advice more specific and tailored to your particular situation and preferences.
Investing In A House Or An Apartment
If you’re sure that property is the right investment for you, or even if you’re still just surveying your options, there is the decision to make as to whether you’re better off investing in a house or an apartment.
Brisbane houses have an average annual growth of 5.66% while units over the same time period have seen a growth of 4.03% (based on data collected*). The same data displayed an average gross rental yield across the properties of 4.75% to 3.35% in favour of units.
There is no blanket response to whether a house or an apartment will be better for you as any property investment will be circumstantial to your own personal situation.
Our advisors pride themselves on their ability to gain a holistic understanding of your situation and financial goals before making any investment recommendations.
*Suburbs – Nundah, Tingalpa, Indooroopilly, Ashgrove, Balmoral, New Farm, Spring Hill and Chermside (source)
Risks Of Property Investment
Though often perceived otherwise, the housing market is not without its fair share of risks. There are risks associated with the market, interest rates, liquidity and inflation, as well as more specific risks that may be associated with your particular investment.
There are many factors and incentives that make property a great investment strategy, such as tax benefits that help your cash flow and the first home buyers grant. These incentives, however, come with their fair share of fine print.
Cashflow & Property Investment
In some cases what can seem great from a cash flow perspective may actually turn out to be a bad investment for a variety of other reasons.
We firmly believe that property should be viewed as a capital growth asset and that your decision to buy a particular property should be made based on it ticking all of the boxes for capital growth (supply and demand) rather than looking at an increased cash flow of a few extra dollars.
It’s important that you consider all of the factors that come with property investment and you should take the time to talk to our investment property specialists for help and guidance as to what’s right for you.
Making The Right Property Investment Decision
At the end of the day, the best investment for you will be unique to your circumstances. By taking the time to get to know you and your situation and with a thorough understanding of investing and the local property market, My Wealth Solutions can offer you the right investment advice for your situation.
Want to talk to a property investment specialists today?