House and Land, Property Investment

Most people will start to research properties one of two ways when curious about property investment: based on an area or a preferred price bracket.

Research suggests about two-thirds of investors will look in the same postcode where they live. Investing in an existing property in an area that is well-known or close by is often the first port of call. But this is a decision made more with the heart than the head.

What feels good may not lead to the best investment decision. The thing that should be first and foremost in your mind is the performance of the suburb. Good property investment hinges around the potential growth of a location and the demand for rental properties, which is generally linked to employment opportunities, educational facilities and transport options.

Dual Key Investment Properties

Another key decision when weighing up investment property options is whether to opt for a new build or an established property. Here are five reasons that suggest investing in a new build pays dividends over choosing an established property.

1. Attracting Top Rent

One of the big upsides of building a new investment property is the ability to attract higher rents. There is a significant premium for new properties and being able to attract more from rent helps reduce holding costs.

Negative gearing is also something to take into consideration. This is the process of being able to get tax back to help subsidise the holding costs of an investment property.

2. Tax Benefits

New properties offer better tax benefits than established homes. When assets are more than 6 months old, like when you purchase an established property, you cannot claim depreciation. Purchasing a new property, or one built or renovated less than 6 months before you buy it, allows you to claim all depreciation over a 40-year lifespan.

There are other tax deductions like property management fees, leasing fees, maintenance and smoke alarm testing but being able to claim depreciation is a sizable tax benefit.

3. Less stamp duty

Building a new investment property means you will be purchasing a piece of land then having a home built. This means paying stamp duty on the land value only because the house doesn’t physically exist or have a value at the time of the transaction. When you buy an established home, you must pay stamp duty on the full value of the house and the land.

4. Less Maintenance

The older a house is, the more likely it is that things will need repairing. Old properties will have character and charm but can also be expensive to maintain, which is not ideal when looking for an investment. The aim is to bank as much rent and/or tax from your investment rather than spending it on maintenance.

5. Better Design

Modern homes generally feature the most up-to-date features and technology. No matter what price range you are looking in, homes quality insulation, better access and wider hallways for increased mobility are likely to appeal to more people now and into the future.

Homecorp has a range of house and land packages featuring full-turn key designs that take the hassle out of building a new investment property.

Homecorp began developing in 2004.  since then our experience has led us to develop a scalable construction process that means we can build a house in just 25 weeks from slab down.*

Homecorp believe that all Australian’s deserve a good foundation, a great home, to build from.

*terms and conditions apply

What makes a great property isn’t always black and white but Homecorp’s expert team call on decades of experience to identify and secure the best property in hot spots with potential.

We have opportunities building right now. If you want to know more, get in touch today. The only thing we love doing more than building is talking about building!

If you’re curious to know more, talk to the Homecorp team today.