Rentvesting: A Strategy For First Home Buyers
Buying an investment property can be one of the most exciting decisions you can make and despite popular belief; you don't have to be a business mogul to buy your very own investment property. Buying an investment property while continuing to rent - ‘Rentvesting’- is a popular strategy used by first home buyers to get a foot up on the property ladder.
Rentvesting is common with first home buyers as they are still able to rent in a suburb where they frequent, yet can afford to purchase a home in an up-and-coming suburb as a long term investment. At Homebuyers Centre we are seeing more and more people come to us to build them a new home as an investment property. So, if investing in property has crossed your mind and you like the idea of becoming a ‘rentvestor’ – here are some tips to help you along the journey.
One of the big benefits to building your investment property is that you’re unlikely to have significant maintenance costs. When building a new home with Homebuyers Centre, you’ll get a 25 Year Structural Guarantee and 12 Month Service Warranty which offers peace of mind. If you were to purchase an established ‘pre loved’ home as an investment property, chances are the home will not be covered by any warranty’s and any maintenance or pest control issues will be your responsibility.
Another plus side to building an investment property is that you, as the owner, can tailor the design of your home to be in line with what you think prospective tenants will want. As a building company, we can help you make these decisions during the consultation process to ensure your property will be appealing to your desired tenants.
Building loans and investment loans are quite different from regular home loans, which is why it’s important to get advice from an expert. Our finance partners at Resolve Finance have access to competitive investment loans and construction loans – in fact over 80% of their home loans are construction, making them the specialists in the field. More information on construction home loans can be found here.
Final tips about building an investment property:
The First Home Owner’s Grant (FHOG) is not available to be used for the purchase of investment properties. The good news is, if you have no plans of moving into your investment property and you decide to build or buy later on, you may still be eligible to take advantage of the grant.
Want to find out more? Call us on 131 751.
All finance services provided by Resolve Finance Australian Credit License 385487. Please be aware this advice is general in nature and personal circumstances have not been taken into consideration. So please see your tax accountant or licensed financial advisor to see if this advice is right for you.