Multiple Property Investment

This is a service for the serious property investor who believe their path to long term wealth does not come by working hard and investing smart, it comes by leverage and debt in long term capital growth property where the tenant and tax man help contribute to your wealth.

There are 750,000 Australians who own an investment property, with 2/3rds earning less that $38,000 per annum according to the Australian Bureau of Statistics 2001. Australians understand that they need to do more than just work and have 9% put into superannuation to be able to live a comfortable lifestyle when they retire. What stops the rest of Australia and why do 70% of those 750,000 stop at only one investment property?

There have been literally thousands of books and magazines and articles and seminars run to assist people in their education, why is it that most people choose not to invest in multiple properties? In one of the early books, Jan Somers in 'Building Wealth Through Investment Property' (Somerset Financial Services, Brisbane 1992) illustrates the strategy of purchasing one investment property every two years to achieve a net worth of over 1 million dollars in ten years. Using current day numbers, the same still applies as the graph below shows.

(Based on median property price of $350k, growth of 7% pa, interest at 8% pa, marginal tax rate of 30% and rental yield of 4%)

What investors are finding is the difficulty in achieving this. Going out alone, arranging finance through your local branch or even mortgage broker and then spending nights and weekends hunting for suitable properties, attending auctions and settling is a very time consuming process. Facing the prospect of repeating it is just too daunting and you then run into the issue of being able to fund the (usually) negatively geared property out of your cash flow. How on earth can people afford more than one property?

You need an experienced team around you, people who have done it before and are active property investors themselves so they understand the strategies involved. The team consists of a finance broker, an accountant, a solicitor or conveyancer, a property manager and a property strategist.

That is where Reid Consultants comes in to help you. We sit down to discuss what your goals are, what your resources are and your timetable. We will structure your finances and show you how it is managed and how you can borrow for the next property without greatly affecting your day to day lifestyle. We have access to a team of professionals to assist the process of sourcing and buying properties as you need or want and to help at the back end of the cycle.

There are a number of property strategies that work for many people, some prefer positively geared properties and there are finance solutions to facility this, others prefer negatively geared properties and again, different finance solutions apply. We have written a series of newsletters specifically discussing aspects of investment and wealth creation in more depth, please take some time to read the newsletters, accessed by the Tab on the left.