What's the benefits of owning an investment property?

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  1parle on 30/06/2018 - 00:46

  +2

  I think ppl buy investment properties to save tax on their top bracket via using negative gearing

  • 

    newbiesh on 30/06/2018 - 01:11

    +2

    yes thats correct but the amount you recover by tax you actually had to pay initially and its sort of getting partial refund of your expenses

    • 

      1parle on 30/06/2018 - 01:16

      Not actually, you claim depreciation on build n all which runs in 000's for first 7 years. Like if you've bought a 600k property, for the first year, you claim somewhere around 30-40k in the depreciation. You can do this for 7 year I suppose. I'm not sure on actual numbers but too many accountants in market who can do that for you

      • 

        Ocker on 30/06/2018 - 08:43

        +1

        You can depreciate the building component at 2.5% pa for the first 40 years. Fixtures and fittings have variable rates/periods of time of depreciation, but I reckon 30-40k total depreciation on a $600k is not attainable - nowhere near it.

    • 

      dcep on 30/06/2018 - 01:26

      plus capital gain when selling

• 

  specks on 30/06/2018 - 00:51

  -1

  Savings account:
  - Illiquid: no access to money until period is over.
  - Inflation can reduce your returns
  - Low risk = low return
  - Zero management

  Investment Property:
  - 2 income streams; capital growth and rent
  - Ability to add value
  - Management involvement
  - Physical asset
  - Higher return rate
  - More riskier than a savings account

  —— Learned this in my first year, absolutely hated the unit.

  • 

    BobLim on 02/07/2018 - 08:23

    +2

    Real estate is more liquid than cash in the bank? Ok then…

    • 

      specks on 03/07/2018 - 14:30

      oops my bad, other way round

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  Tasmaniac on 30/06/2018 - 01:33

  Worldwide economies are continuing to improve, when a billion more foreigners can afford Australian properties you'll be glad you bought something.

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  Ocker on 30/06/2018 - 08:44

  +3

  The great Aussie dream was always to own your own home - now it is to own somebody else's.

• 

  HighAndDry on 02/07/2018 - 18:32

  Investment properties have a lot of benefits:

  • If you can positively gear it, you make money.
  • If you negatively gear it, you save on tax (short term, see others for long term).
  • However you gear it, property is one of the safer investments in the long-term.
  • If you move into it for a few years (ask your accountant) you get a discount on CGT payable on selling.
  • Generally higher returns than savings accounts or even term deposits these days (very low interest rates).