Life’s a beach for in­vestors

The Courier-Mail - Home - - Outlook - On Queensland’s Development Market -

THERE is re­newed in­ter­est in own­ing a hol­i­day home, ac­cord­ing to PRD­na­tion­wide. Whether as a des­ti­na­tion to va­ca­tion or as an in­vest­ment prop­erty to rent out – sec­ond home pur­chases are set to take off again.

“Aussies, buoyed by the coun­try’s healthy econ­omy, are tipped to re­turn to the hol­i­day mar­ket,” PRD­na­tion­wide re­search di­rec­tor Aaron Maskrey said.

“The idea of hav­ing a beach shack or coun­try cabin to get away to on week­ends is enor­mously at­trac­tive.

“Due to the un­cer­tainty and a loss of con­fi­dence in the mar­ket dur­ing 2009, many in­vestors were forced to put their hol­i­day homes on the mar­ket.

“Now that con­fi­dence has re­turned, a lot of peo­ple are feel­ing the lure of pur­chas­ing a hol­i­day home again.

“Unit sales on the Sun­shine Coast in­creased by 11.3 per cent, dur­ing the half year pe­riod end­ing Septem­ber 2009.

“Sim­i­larly, in the Gold Coast, house sales in­creased by 6.9 per cent for the half year pe­riod. The Tweed Lo­cal Gov­ern­ment Area ex­pe­ri­enced in­creases in ac­tiv­ity for both units, 30 per cent, and houses, 31 per cent.”

PRD­na­tion­wide Kal­lan­gur prin­ci­pal Gary Ro­den has owned sev­eral rental prop­er­ties over the past 20 years.

“If you are at a re­tir­ing age I sug­gest that you pos­i­tive gear your in­vest­ment so that you can rely on the rental in­come,” he said.

“If you are still em­ployed or in busi­ness, the idea would be to neg­a­tive gear by tak­ing an in­ter­est only loan where the in­ter­est paid can re­duce your in­come and the tax you have to pay.”

Mr Ro­den said the most im­por­tant part of buy­ing a rental prop­erty is to pur­chase in a high cap­i­tal gain area and be pre­pared to own the prop­erty for a min­i­mum of five years.

“In­come from rental prop­er­ties is just the bonus, the big­gest money gain is the value of hold­ing a prop­erty and sell­ing af­ter sev­eral years,” he said.

Mr Ro­den said the rental that you achieve re­lates to the size and price of the prop­erty.

“When you are looking for a prop­erty, re­mem­ber that the larger the home, the more it would in­crease in value based on the in­creases in build­ing costs and ma­te­ri­als.

“To get a good ten­ant pay­ing an at­trac­tive rent, I sug­gest that you buy the largest home that your bud­get can af­ford and main­tain.”

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