Make a solid investment for your child

Is buying an investment property feasible and worthwhile when planning for your child’s future? Warren Thompson spoke to Jonathan Kohler, CEO of Landsdowne Investment Properties on SAfm’s Market Update with Moneyweb about this.

“When young adults are renting their first property, they rent for a couple of years and then a few years down the line their salaries have increased and they are maybe in the market to purchase their first home. They really, really struggle to obtain that finance; they struggle to have enough money to put a deposit down on a home,” says Kohler.

He suggests that the moment a child is born, if parents can get finance to purchase an investment property – even a very small property – a tenant could service that debt.

“By the time your child is at the age of 20, that child will own an investment property that is completely paid off.

“They can either sell and use that as a down payment to buy a larger property. Alternatively they can keep that property as an investment and get rent for it, and then they can jump from that property and buy a larger property to live in.” – Moneyweb