Investing in Property – The Why

The saying goes “Landlords grow richer in their sleep” and it is quite true.

Owning properties can provide investors with steady rental income as well as capital appreciation. For primary residence owners investing in a property creates a savings platform through the repayment of the bond as well as the capital appreciation. The sooner that you can climb on the property ladder the sooner you start creating wealth.

However, it is important to assess the investment carefully.

  • Location and the future of the location is the first and foremost aspect to consider when purchasing an investment property that will result in capital appreciation.
  • Take stock of fixtures and fittings. Are they durable to keep maintenance costs low?
  • The demand for a particular property.
  • Take a five-year view as a minimum time frame for the investment. Ten years is preferable as this will generate a more valuable return on investment, as this should give the best capital appreciation on a well located and maintained property.

 

Tax Benefits of becoming a landlord

If you receive rental income, there are certain rental expenses you may deduct on your tax return. These expenses include:

  • bond interest
  • advertisements
  • agency fees of estate agents
  • insurance (only homeowners not household contents)
  • garden services
  • repairs in respect of the area let and
  • security and property levies

 

View our Oak Tree Investment Case Study

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