Strategy

When investing in property you need to have a strategy and a purpose. Sure the end result is to create wealth, but this is a very vague goal.

What is the purpose of the wealth?

So here are some Strategies that will fit into most investors Game Plan

Pay Off Home Loan


What better way than to pay off your home loan than to use property investing. In this strategy you utilise equity in your home to invest in property.

Pending the amount of equity you have along with your serviceability from a lenders perspective will depend on how many properties you can invest in. Our example below shows just how two investment properties purchased can help pay down your home loan fast.

How? You purchase two investment properties, obviously in the right location and the right part of the property cycle and hold for around 5-6 years. Then you sell and put all of the profits onto your home loan.

Because the properties should be cash flow positive, there is no extra outlay from yourself, so you can continue to keep paying off your home loan during this period as well.
Once sold, you repeat but this time as your home loan has reduced, equity increased and your cash flow increased as a result you are able to purchase 2 properties and repeat.

Download an example of how this game plan looks on paper..




Rent & Invest


For many people they cannot afford to buy where they live but have the ability to be able to invest.

As a strategy, this allows the investor to invest and create wealth through investing in property and then sell the property or properties in 5-6 years and use the funds to then purchase a home where you want to live.

You would then switch to the Pay Off Home Loan Strategy above on what to do next

Download an example of how this game plan looks on paper..




Rent & Invest – Passive Income


Similar to the Rent & Invest strategy except that you build a property portfolio but use a Buy & Hold strategy and create a passive income. Instead of putting any extra funds onto your home loan, you pay it into an Offset held against the investment property.

As your Offset account balance increase, the properties become more cash flow positive and start to create a passive income for you.

This strategy works well for those who move around a lot for work and Ex-Pats.

Download an example of how this game plan looks on paper..




Self Managed Superannuation Fund (SMSF)


With legislation allowing investors to use their superannuation to invest in property and borrow under a certain structure, this strategy can allow those who like bricks and mortar as a preferred investment medium.

Now given this area of investing is highly regulated, we are not allowed to give advice here so this example is general in nature and investors need to obtain independent financial advice from a qualified financial planner prior to looking at investing in this area.

Self Managed Superannuation Fund (SMSF)

We must firstly make it very clear that wHeregroup do not and cannot give financial advice in this area of investing.

Although you have the right and ability to make up your own decision to create and SMSF, we strongly recommend that you do firstly speak with a suitably qualified financial planner and put a plan into place first.

We are, however, qualified to write SMSF mortgages and we do purchase properties for clients wishing to invest within their SMSF.

With legislation allowing investors to use their superannuation to invest in property and borrow under a certain structure, this strategy can allow those who like bricks and mortar as a preferred investment medium.


Create Passive Income


Now that you own your home with no mortgage, the next stage is to create a passive income to replace the income you earn from your job.

This will give you options in life where you can either reduce your workload or stop work all together.

This still utilises a Buy & Sell strategy initially but a Buy & Hold long term strategy. This is wHere Todd is right now, building this income…

Download an example of how this game plan looks on paper..



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