Since the BRW Rich List was started in 1984, there have been nine Australian property developers who have featured every time. And given that there are only 19 people overall to achieve that feat, it appears property can be a winning formula.

Frank Lowy leads the charge, listed currently as Australia’s second richest person with $6.87 billion to his name. The rest of the ‘big nine’, in descending order, are Harry Triguboff ($4.95 billion) and John Gandel ($3.7 billion), followed by Stan Perron, Maurice Alter, Alan Rydge, John Kahlbetzer, Bruno and Rino Grollo and John Longhurst.

Further evidence of the earning potential of the property market can be seen in this year’s list. Of 36 billionaires featured, 15 earned a significant amount of their wealth as a result of the local property boom.

Despite the continued presence of the nine seasoned property moguls hinting at the lucrative potential of the real estate market, there is a relative dearth of property investors in the Young Rich List compared to the full list. Eight out of 100 in the BRW Young List predominantly made their earnings in property as opposed to 55 of 200 in the full Rich List published last year. This indicates a disproportionately small amount (approximately 30 per cent) of property investors in the Young Rich List.

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If you are keen to get into the property investment market but are unsure of where to start, getting the right property investment & development advice is essential. To find out more about property investing, speak to the experts at Rass Global Investments.

The basic premise of Mortgage Planning is:

  • Debt elimination options
  • Future leasing of owner occupied home (or homes)
  • Non-cross securitisation of more than one property per mortgage
  • Provision for automated repayments
  • Allowing for future equity and investments as well as retirement needs
  • Cash flow needs without disrupting loan repayments
  • Consideration for further borrowing.
  • Investment loans
  • Development loans
  • Construction loans

Lenders don’t always have the necessary understanding and expertise in dealing with advanced loan structuring. Banks have a tendency to lock properties against all mortgages, which places them in an advantageous position of needlessly holding all securities, often to the detriment of the investor.

People with multiple investment properties, in particular, should seek out specialised professionals to gain the flexibility they require in mortgage planning their loans.

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For more advice on Mortgage planning, property investment, property development and management in Sydney or Perth, contact Rass Global Investments. Not only can they help you start an investment portfolio, they can manage your investment properties for you too.

Unprecedented low interest rates, combined with moderate pricing, tax deductions and relaxed superannuation rules has seen many property investors jumping at the idea to reap the many financial benefits of property investing.

Investment Opportunities

Within the past year, Australian property prices had been steadily falling and spending was minimal. The Reserve Bank of Australia (RBA) drastically cut interest rates and now we find ourselves in a state of recovery with house prices on the rise and auction sales flourishing. The bulk of the market activity, however, has been driven by investors, rather than home buyers, looking to capitalise on the opportunities.

Investor loans have leapt by 16 per cent in the past 12 months according to ABS figures. Meanwhile loans to occupiers have also increased but at a much slower rate – 6.6 per cent.

Aside from the helpful nudging coming from the RBA, property investment is soaring due to a perceived lack of safe options in the wake of the GFC. Investors are still gun-shy when it comes to intangibles and they don’t want to be burnt again. And with population unrelentingly on the rise, the demand for housing is a secure constant.

Investors Versus Home Buyers

While this has led many to declare an end to the two year property slump, it appears we are gradually shifting towards a nation of investors rather than homeowners. And the current rise in house prices is not what prospective home buyers will want to see.

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After several tough years for real estate, investors are drifting back into the property market. In addition to greater stability and faith in the global economy, investors are encouraged by low term deposit rates.

For those who have weathered the storm, a potential dilemma looms in terms of direct versus listed properties. Naturally, it’s important to consider the pros and cons of a number of options. This includes real estate investment trusts (REITs), single/multi-asset syndicates, and closed/open-ended funds.

Direct Properties

Over the last year or so, property trusts have performed well, but steadily falling REIT yields have led people to opt for direct property for higher returns instead. The benefits of buying direct commercial property is less determined by the equities market. This generally means less fluctuation and more consistent financial yields.

Though direct property investment is a more drawn out process (requiring substantial capital to get started), the concrete nature of the assets provides more stability and, in turn, the returns are typically higher.

Listed Properties

One of the main attractions of a listed property, on the other hand, is its liquidity and accessibility. The flipside, obviously, is that REITs tend to be a lot more up and down.

Both direct and listed properties have their benefits depending on the financial means of individuals, though the current trend for investors steering away from unpredictability is to opt for the steadier ship of direct investments.

For more advice on loan structuring, property investment and management in Sydney and Perth, contact Rass Global Investments..

Thousands of people incorrectly (and unknowingly) claim tax deductions each year. Considering the proliferation of negative gearing in property investment, it is especially crucial to know what deductions you can claim for. Here we look at several rental property deductions you can rightfully claim for.

Loan Interest

You might be able to claim instantly for interest incurred on loans used to buy properties, land on which to build properties, or items that serve the property (appliances etc.).

Depreciating Property Assets

Certain assets can be written off on tax that can add value to a property but depreciate individually, such as televisions and microwaves. Construction or renovation costs, however, do not qualify in this category. Depreciating property assets can also be claimed in the long term as they decline in value.

Property Maintenance Costs

Running repairs and maintenance costs can be claimed back on tax.

Tenant Costs

Costs stemming from tenant activity, such as lease agreements or eviction costs, can be claimed straightaway.

Renovation Costs

Any construction or structural upgrades, both internal and external, can qualify as capital works deductions.

Stamp Duty and Other Fees

Borrowing costs can be deducted over the course of the loan period. This includes things like mortgage stamp duty and loan establishment fees.

When submitting your tax returns, be sure to read ATO conditions thoroughly or seek the advice of qualified professionals in property and finance.

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Real estate has always been a risky market. At any given time, property value can be grossly undervalued or inflated depending on the mood of buyers and fluctuating interest rates.

Emotions and sentiment often factor into decision making which accounts for some random fluctuations. At the end of the day, property will always be worth what someone is willing to pay for it which is why many savvy property investors employ a counter-cyclical approach to buying property.

Counter-cyclical investing basically involves operating independently from market trends. Rather than selling at the first sign of trouble or reacting to a slight upturn, counter-cyclical investors look to learn from previous cyclical patterns rather than getting caught up in group hysteria or sentiment.

Counter-cyclical investors can capitalise on the reactionary nature of others who panic at the first sign of downturn and look to offload their assets at bargain prices.

Though some troughs and peaks are longer than others, markets, including property, will always ebb and flow in cycles. This is where a little bit of patience, rationality and opportunism can go a long way for investors.

In any sort economic climate, concrete assets such as property are invaluable investments if handled effectively. If worst comes to worst and another financial crisis hits, far less vulnerable than stocks, property will always hold substantial value. A counter-cyclical approach to the market could be the way to make the most of your investments.

Property Investing in Perth

If you are keen to get into the property investment market but are unsure of where to start, getting the right property investment advice is essential. To find out more about property investing, speak to the experts at Rass Global Investments..

Once you get a foothold in the property market, the next logical step is to expand and maximise your investment portfolio.

The vast majority of Australian property investors tend to only have a couple of properties. The main obstacle in buying more is the daunting task of having to manage it all, and understandably so. Property is a substantial investment on any scale, particularly for those who are new to the game and perhaps not yet seeing the financial fruits of their investment.

Get the Ball Rolling

Buying your first property is, predictably enough, the key to getting the ball rolling. Investors always maintain that the first property is the most difficult. No doubt there will be mistakes made and, hopefully, learned from which will help to inform your future investments.

Add Value

Add value to your property wherever possible. Many investors look for properties with the best potential for value increase – that is, bad houses in good locations. By renovating or upgrading, you could increase value exponentially, not just of the sale price but also the rental income.

Keep Your Eye on the Prize

Though you’ll occasionally need to roll up your sleeves and work to get the most out of your property, it is just as important to know when to cut your losses. It’s unlikely that all your investments will be winners, so if you can identify better opportunities elsewhere, there’s no shame in selling.

Get Advice

Property investment advice at every stage of your portfolio is essential. Make sure you speak to the right people and get the right property investment advice by contacting Rass Global Investments..

The local real estate climate has improved markedly in recent months. Lower interest rates and a steadying global economy have both contributed to a rise in consumer confidence throughout the property sector.

“We’re now seeing a lot more activity around sales compared with this time last year,” said RP Data’s Tim Lawless. The flurry of activity is encouraging for vendors and property investors alike, with a vast majority of property sales recording healthy profits.

According to figures from RP Data, 87.3 per cent of homes sold (58,677 in total) during the March quarter recorded gross profits on their previous purchase price. And it’s the higher end of the market (properties above $1.5 million) experiencing the significant growth during the past six months, increasing by 4.8 per cent in comparison to 3.2 per cent at the lower end. Mid range properties also performed strongly with a 4.6 per cent rise.

This can be attributed, at least in part, to a flow-on effect from share market growth. “We are starting to see profits taken from the share market being channelled into the more expensive housing markets,” Lawless said.

Time of ownership did play a part in these statistics. The likelihood of making a gross profit or loss is quite different based on the length of time a property has been owned. Homes purchased before the GFC in 2008 were far more likely to turn a profit this quarter.

Property Investing in Sydney

If you’re ready to make the first move in property investing but are unsure of where to start and who to talk to, contact property investment experts, Rass Global Investments. today.

Bidding at a property auction is not as simple as yelling out your price. If you are planning on bidding at an auction in the near future, best to get some tips from the following video.

First of all, identify your maximum price. This means using all your research, as well as factoring in your own budget to establish a walkaway price. In the heat of battle at auction, however, you need to make sure you stick to it. Remember to bid high, bid strongly, and don’t shy away from bidding first. This will identify you to other bidders as a serious contender.

Have your finances already in place. Don’t speculate on potential funds you might have in the future. You want to be able to bid with confidence on the day. And don’t forget to bring your chequebook to provide a deposit.

In order to gain an insight into the auction atmosphere, attend other auctions beforehand to gain experience. This is particularly useful for new homebuyers.

Make sure you request any contract changes prior to the auction date. This might include long settlement periods or deposit terms and need to be agreed to in writing before the time of auction.

Arrive early to give yourself plenty of time to register, find a good spot and size up the competition. The most important tip for buyers, however, is to make sure that you do actually make a bid. If the property is passed in, the highest bidder has the first rights to negotiate with the owner. Many people make the mistake of not bidding, in the hope of negotiating with the vendor afterwards, but with this approach you risk missing out entirely.

To make sure you get the exact property that you want, get professional property advice from Rass Global Investments..

Mortgage offset accounts are an avenue some homeowners may find useful to explore. While it requires a little bit of excess cash to set up, it enables you to utilise your savings to minimise your loan interest as well as saving you some tax in the process.

Put simply, an offset account is effectively a savings account tied to your mortgage. Rather than accruing interest on your regular savings and incurring interest on your loan separately, your offset account balance is subtracted from your outstanding loan when interest is tallied.

For example, consider a loan of $400,000 with an interest rate of 6 per cent. If you have $50,000 in your offset account, the 6 per cent interest will only be charged on $350,000 of your loan.

At tax time, the benefits are definitely noticeable. Whatever is in the offset account is not considered taxable income. So, not only do you pay less interest on your mortgage but you also lose less of your income to tax, enabling you to pay off your loan quicker on two fronts.

Of course, with all these benefits, you might wonder why everyone doesn’t take this route. There are some downsides to note. Some lenders will factor in the possibility of an offset account by charging higher interest on the loan in the first place. The numbers really depend on your own personal circumstances so dust off the calculator and work out the figures before committing to a mortgage offset account.

For more property investment advice, talk to the property investment mentors at Rass Global Investments..