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Investment in Real Estate: A Long Term Strategy

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Investment in real estate should always be a long-term option, as a good investment property will steadily increase in value. This is the general principal of Capital Growth: Simply put, the longer you invest, the more value you will accumulate. Property is a long term investment, and unlike shares, you probably will not see returns immediately. In any type of investment, it is crucial that you look at all factors upfront and determine that this is the right investment type for you. Two major factors you will need to take into account when considering a property investment are: If this form of investment is the right one for you, and the state of the investment property market you intend to buy into.

Building an Investment Portfolio: Property and Shares

In order to protect and optimise your investment potential there are some important factors to look at. Both sides on the property and shares investment debate have solid arguments when you consider the long-term stability of your investment.

There are positives and negatives with investing in either shares or property and both markets have cycles of growth and downturns. No matter which market you are looking at investing in, you should look at individual factors affecting that investment. The stock market can be sporadic in nature, however, despite property investments remaining relatively stable throughout the Global Financial Crisis, capital growth in the property market is generally much slower. The variance of your investment portfolio is important to consider when looking at an overall balance in your investments.

Investment Property in Australia

Investment in real estate within Australia can provide your investment portfolio with long term stability. After years of property investment advice warning of a "market crash" due to over building, population and housing statistics from the last few years show that we are facing a housing shortage, especially in metropolitan areas. If these projections are correct, the housing deficit will continue for a number of years.

Australia's steady population growth, coupled with infrastructure development is a key indicator of the overall health of the Australian housing market. Currently, the property market is undersupplied, largely in metropolitan areas, with the number of people looking for property to rent, lease and buy outnumbering the available properties.

What Does Property Investment Mean for You?

Before investing in property, it is important to look at the bigger picture and ask what the goals of your investment portfolio are, and will this investment compliment those goals? Remember, three main points before looking at the property market:

  1. Investment in real estate is a long term option
  2. Investment in property over shares can be a more stable option
  3. Current property investment advice and statistics indicate an undersupplied property market, which should in the long term lead to strong growth

Making decisions about your investments in real estate can often be an intricate and complicated process. For more information on these above factors, or what to expect when you enter the investment property market, speak to Which Property. back to top

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