Premium Finance Services

One of the questions we here at Premium Finance Services keeps getting asked is, ‘When is the best time to invest’

The answer is simple; we believe the best time to invest was yesterday; the next best time is today.

We believes property investment to be a long term strategy. Its value will have its movements over the economic cycle but consider this; what was you home worth ten years ago and what is it worth today?

One of the driving forces in property as an investment is the fact that it is population driven, people have to live somewhere.

The smart investor will buy a property in an area in which people will want to live.

The investment will be close to schools, transport and shopping facilities to ensure a minimum vacancy rate and a maximum rental return

Bureau of statistics states:

• At 30 June 2008, the estimated resident population of Queensland, for example, was 4.29 million, an increase of 97,900 people since June 2007. For the five years from June 2003 to June 2008, Queensland’s average annual growth rate was 2.4% per year, making it the fastest-growing state or territory for that period.

In real terms, the Australian housing finance market nationally, has seen tremendous growth in the last two decades. The market growth has been fuelled in recent years by various factors, including a stable low interest rate environment, sustained growth in housing prices and most importantly a continuing demand for investment property loans.

Premium Finance Services believe that investors remain a large influence on growth, in some instances, accounting for up to half of all sales in some suburbs.

In Australia, 70% property investors are on incomes between $45,000 and $60,000 per annum, and over 90% of all millionaires become so through investment in real estate.

Small wonder there is still a demand for investment properties.

The concept of Property as a wealth creation vehicle is to accumulate it during your working life with little or no negative impact on your lifestyle. Positive steps need to be taken as statistics indicate that around 83% of Australians will retire with less than $30,000, not much to show for a lifetime in the work force.

That said why are some investors hesitant?

Property prices are flat at the moment and interest rates are there lowest for years and yes, we are all aware of the impact of the global issues on our economy. Is there any such thing as perfect conditions though?

We believe the time to move forward for those astute investors is today, not tomorrow.
Today’s preparation and actions determine tomorrow’s achievements.

As part of an overall debt reduction and wealth creation strategy Premium Finance Services recommends the reduction of non deductible house hold debt, particularly the principle place of residence, as soon as possible, in fact according to recent findings of nationwide Mortgage Finance Association of Australia (MFAA) and Bank West Home Finance Survey, a large number of Australian Homeowners plan to pay off their mortgage sooner.

The survey interviewed 500 people who had taken out a home loan or refinanced in the past seven years or who intended to take out a home loan in the next seven years.

The survey showed that 86 percent of respondents want to pay off their mortgage quickly and the same amount is confident in their ability to do so. Eight in ten respondents indicated they would pay off their mortgage sooner by making higher regular repayments or lump sum repayments.

While only two in ten said they would make more frequent repayments. Women showed a higher interest than men in paying off their mortgage sooner.

Thanks for reading.

Till next time,
Premium Finance Team

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