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ISCOVER
Staff Reporter
A rocky share market is bolstering Australian homeowners’ appetite for property investment, with one in four planning to purchase a second property, according to LJ Hooker Finance research.
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The research found that 26 per cent of existing homeowners are currently looking to buy an investment or holiday property.
LJ Hooker deputy chairman Leslie Janusz Hooker said over the last decade Australian’s have been listed amongst the highest shareholders per capita globally.
“Residential property is a traditional favourite amongst Australian investors due to the long-term stability of the market, potential capital gains or opportunity to boost income through regular rent,” he said.
“However the multiple double-digit losses experienced by the share market in 2011 are driving a stronger interest in property investment. Data shows that over a 10 year period, property investment yields a higher after-tax return than shares. Uncertainty in the share market is drawing Australians back to traditional investment options to ensure long-term results.”
Mr Hooker said the Australian Tax Office’s recent draft ruling on Self Managing Super Funds borrowing legislation may enable more Australians to use their super to purchase and maintain investment properties using a limited recourse borrowing arrangement.
“Long-term success via residential property investment is dependent on the strategic choices made by the buyer who should always get independent advice,” he said.
“To get the best results, investors should seek properties that are located in potential growth areas, that have low rental vacancy rates and to choose a property that doesn’t require major renovations or modifications for tenants,” said Mr Hooker.
