This is the most common investment strategy in Australia. The great Australian dream. Most Australians aspire to own their own home. This strategy is simply one to buy and hold a property that you live in and very likely raise your family in.
Home ownership holds capital gains tax advantages in that capital gains, which is very significant on investment properties, is not applied to your principle place of residence. When you sell it, you don’t pay tax Capital Gains Tax on it. Further benefits include the ability to gradually renovate and improve the property at you own leisure to add, and enjoy yourself, value over time in addition to the fact that the property will also highly likely increase in value over time.
This strategy can still be used to enter the property market. Many start off by paying off their own home, or a part thereof, then leverage the equity to branch out into investment properties. You use the equity in your own home to buy others.
IMPORTANT: Be sure to execute this properly via your finance people so that you don’t adversely affect the mortgage on your own home.
Buy and Hold
Renovation or Flipping
Passive Property Development
Active Property Development
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