Property is an ideal way to build capital. In the long-term, property has been proven to keep pace with inflation while giving investors returns of 5 to 6 percent.enables you to put together a retirement nest egg without investing all your money upfront. This is because, apart from the initial deposit, most of the finance will come from your bank in the form of a mortgage loan.
Most importantly, when buying for investment purposes, you must separate your personal tastes from those that will make the property attractive to tenants or future buyers.Most estate agents advise investors to spread their investment between two or three smaller – and cheaper – investment properties than on one larger, more expensive property.
Smaller properties in good areas are a better choice than bigger homes in areas that are not popular with tenants. Most banks won’t take potential rental income into account when considering bond applications. This is because they need to be sure that you can afford the repayments – regardless of whether the property is rented out or not. Most bond originator websites have calculators that will help you determine whether you can afford an investment property.