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3 key questions for property investors during Covid-19

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Aug 22, 2021

We are now beginning to comprehend what life might look like post Covid-19. The last 18 months has forced many Australians to take hold of what is important and to find ways to shore up their financial security against unexpected or unprecedented circumstances.

Red23 Invest are now seeing a trend of first time and experienced investors becoming active again post Covid-19 and taking advantage of record low interest rates and local demand for rental properties.

The team at Red23 Invest have identified 3 key questions which experienced property investors and first time property investors are asking during the Covid-19 recovery.

Why is it a great time to invest in property?

  1. Coming out of Covid-19, there is a current trend of buyers seeking to take control of their financial security through wealth creation and passive income streams rather than being passive about their future
  2. The Reserve Bank of Australia has reconfirmed that the official cash rate is unlikely to rise until 2024. Variable mortgage interest rates will most likely only rise after there is evidence of faster wage increases 

  3. Residential property is currently experiencing double digit capital growth. Investors can unlock equity in their current properties and leverage into additional purchases, sometimes with zero deposit

  4. There are currently generous taxation incentives including building depreciation which may not be available in the future

What are the things you need to know when investing in property?

  1. Establish a clear budget and be comfortable with your appetite for risk 

  2. Create financial objectives.  For example, is it for long term wealth or for establishing a stream of passive income?

  3. Know the anticipated rental returns for different property types within a chosen location

  4. Understand the pros and cons of investing in new or established property

  5. Uncover location benefits. Look at both established amenity and what is planned for the future

What should you seek in a property investment advisor?

  1. An advisor who will remove workload, time, and stress from you

  2. Shows clarity with expenses, terms and conditions

  3. Provides transparency, independence and unbiased facts 

  4. Will use endorsed property investment software for potential purchases

  5. Has a network of preferred partners for rental, taxation & lending advice

A trusted property investment advisor will guide buyers through finance, property purchases, construction, property management, tax depreciation and beyond. They will educate you on utilising equity to grow an investment portfolio.

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