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Is it a good idea for you?
We can help you decide whether an investment property is a good decision for you
Property investing may seem like an easy path to wealth but there are traps for the unwary. You need to make sure you have sufficient extra money to afford insurance premiums and cope with events like not being able to find a tenant for a long time.
An investment property – just one part of your financial plan
A financial adviser can look at your entire financial situation to see if buying an investment property could be a good investment strategy for you.
Diversification is important
If you already have a home but do not have any shares or other investments then you should reconsider buying an investment property because it may mean you have too much of your money invested in property and not enough in other types of investments. Ensuring you have a good range of different investments is known as diversification, this helps reduce risk.
Remember, that while property prices on average have performed well, there are some areas where property prices have fallen and if you had bought in one of those areas then you would lose money, although it may only be temporary.
Buying an investment property is generally a large financial commitment so you should weigh-up your decision carefully.
Questions to consider if you are planning on buying an investment property:
What about other options?
If you want to diversify into investing in property then you can do this without buying an investment property by investing in Real Estate Investment Trusts listed on the share market. If you have a diversified super fund then it’s likely you already have some exposure to this type of investment.
To find out whether buying an investment property is a good decision for you, we recommend you speak to your financial adviser.
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