One of the first step before you deciding to buy a property is to do a thorough before-tax and after-tax cashflow analysis. To your portfolio, cashflow serves just like oxygen and it’s the life blood of your personal wealth. It balances your portfolio’s risk as well as your financial leverage capacity. Thus, the return.
The truth is no one can predict the future because we don’t have crystal balls. However, we can certainly learn from the past and find out what are those elements fundamentally in close association with the property market. Luckily, we find them and we call them - 3 Filters of Growth. And they are definitely not “location, location and location”.
Many Australians’ property dreams are shackled by the loan structures their lenders have provided. Without an overall vision of your entire portfolio, a short sighted broker can process a single loan that will derail your future purchases. Remember banks will only lend you an umbrella on a sunny day. Having a proper loan structure is much more important than just the low interest rate.
The tax benefits for investing in property are quite simply, amazing. Think about all the expenses that you can claim when you purchase an investment property. Interest on the loan, depreciation and running costs like rates, management fees, insurances and land tax are all expenses which turn into deductions to reduce your taxable income.
Australia is definitely one of the most litigated countries in the world. To make sure you can keep the empire you’re building, you should be looking to put walls around you and your assets and to alienate your liabilities by putting legal walls around those liabilities. When it comes to litigation, prevention is always better than cure.
Having a great property manager is the key to success in growing your portfolio. The reason for this is that a great property manager knows and specialises in maximise your investment’s income and reducing vacancy periods. Rental income is ultimately the aspect of your portfolio you have the most control over. It ties closely with your cashflow, your serviceability and thus your leverage.