Which do you think is more important....
Growth or rental yield?
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09-07-2016 18:50 #1
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Investment property question
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09-07-2016 19:17 #2
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Growth as long as the rental yield mostly covers the repayments
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The Following User Says Thank You to Wise Enough For This Useful Post:
BigRedV (09-07-2016)
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09-07-2016 19:23 #3
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Definitely capital growth, if you can afford it, yes it may cost you more to keep initially as you will have to top up the repayments ( even with negative gearing ) but long term it will be a better investment and you can use the equity to buy more property to fund your retirement - in Sydney rents can't keep up with house prices so the return is very low but obviously our capital growth is fantastic!
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09-07-2016 20:05 #4
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Investment property question
Well Sydney is out of the question! Not even looking here!
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09-07-2016 20:14 #5
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Growth for sure, I look at it as a long term investment. We where just discussing this today trying to figure out where to buy next. Not Sydney.
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09-07-2016 20:24 #6
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Investment property question
I get this but surely as a long term investment almost all property would see growth in the long term?
Originally Posted by Janesmum123
Definitely not Sydney or Melbourne!
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09-07-2016 20:32 #7
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Investment property question
We are thinking Adelaide or rural NSW.
One town has rental yield of 7.97% but only 2.36% annual average growth, although some houses have sold for 5x the original price in last 10 years.
The other has rental yield of 6.83% and 5.59% average annual growth.
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09-07-2016 20:32 #8
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Id say growth but you also need at least half decent rent too.
The growth needs to cover the cost of the following just to break even:
- capital gains tax
- stamp duty
- costs associate with selling the house
- top ups on the mortgage above the rent
- maintenance, rates, insurance, etc
Sorry if I'm stating the obvious! I've just seen so many people get burned when it comes to investing in rental properties.
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09-07-2016 20:34 #9
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Investment property question
Yep it certainly does but it's just city properties grow a lot more - say for example ten years ago in our suburb in Sydney the median house price was $550,000 it's now $1,475,000 whereas say in Dubbo (NSW) ten years ago the median price was $350,000 and now it's $430,000 Originally Posted by BigRedV
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09-07-2016 20:35 #10
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I would think Adelaide would be a more stable market. Rural areas are a bit more of a gamble. Originally Posted by BigRedV
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