Property investment is a long-term relationship, which is why first home buyers need to choose their investment strategy wisely. One of the best long-term investment strategies involves buying property and holding it until the investment properly matures. Which generally means holding the property for a minimum of seven to ten years.
If you’re going into property investment thinking that you can just purchase a property and sit on it for a couple years, make some money and get out, then you don’t correctly understand the strategy involved in purchasing property.
Why Australian Homes Are a Long-Term Prospect
The primary reason, is that property lacks the liquidity and therefore the volatility of other assets classes (such as shares). Which is to say, it’s not that easy to buy and sell property, and doing so in a short time span will rarely make you wealthy.
It takes a considerable length of time to sell real estate, and there are numerous costs involved. Though many will view this as a shortcoming, we believe it to be one of property investments’ biggest strengths.
A Proven Commodity for First Home Buyers
Property investment is a tried and tested, well researched, proven commodity. It has the capacity to provide steady, long-term gains through compounding. Which means, you can use the gains you make from one property to leverage into another property. Then, with the combined gains that you make from both of those properties, you can buy more properties and continue adding to your investment portfolio.
The Essentials of What You Need to Know as a First-Home Buyer
Though all of this so far may be sounding a little complex, here are the essentials of what you need to know as a first-home buyer:
By approaching property investment with patience and persistence, you have the opportunity to gain far more success and wealth than most any other type of investment strategy.
By securing proven, high performing property that grows consistently over time, you can ensure that you will make it to the top of the property ladder. But, keep in mind, understanding property markets takes time. Getting a grip on the cyclical nature of real estate is something that even expert investors have difficulty with. Knowing your local neighbourhood and correctly understanding the investment fundamentals of your property market are two very different things.
The good news, you can learn. Educate yourself as much as possible on real estate and property market trends. Ask for expert advice, do your own research, watch trends, attend auctions, pay attention to what is happening around you and research the why’s of those happenings.
Owning your own property and growing your property investments is a proven way to wealth in Australia. Property investing is all about the future. Formulate an investment strategy and be prepared to be in it for the long haul.
