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by Samantha & Nicole
What are the Pros and Cons of an Investment Property?
  • Firstly, there is the potential for capital growth on your investment property, an attractive option for investors
  • The rental income you receive from your property may cover a large part of the mortgage repayments and later down the line can provide you with a regular income
  • Having a rental income each month is considered part of your income, which lenders look upon favourably when applying for a second home loan for either a owner occupied property or another investment property
  • Owning an investment property can allow for an increase in equity, which you can then use towards another deposit on an owner occupied home or investment property ultimately building up your property portfolio
  • Having an investment property can be a tax benefit.


  • Interest rate rises can affect your interest rate and in turn, increase your repayments
  • You need to allow for periods of time where there may not be a tenant in your property and therefore you will have to cover the rent
  • There are costs that you may not have thought of when buying an investment property such as maintenance, management, insurance and repairs, water rates, council rates etc.
  • Rent can drop due to market forces as well as lack of maintenance of your property
When looking to purchase an investment property, the most important things to consider is its potential for capital growth and the maximum rental incomes you can receive.

Am I still able to receive the First Home Owners Grant if I own an investment property?

It is possible to receive the First Home Owners Grant of $7000 providing you never lived in your investment property for any period of time and it was purchased after July 1st, 2001.

Also, you need to be:

  • 18 years and over
  • Australian citizen or permanent resident
  • A natural person (that is, a person not a company or trust)
  • You and/or your spouse has never owned a residential property, either jointly, separately or with some other person before July 1st, 2000 in any State or Territory of Australia
  • You need to occupy your established home as a principal place of residence within 12 months of either settlement or completion of construction
It can be beneficial for you to provide evidence to show that your property is for investment purposes only. For example, if you are renting out your property, you can show the rental agreement you have between you and the tenants and/or real estate agent. However, the Office of State Revenue will investigate and confirm your investment property circumstances.
Samantha & Nicole
Samcol Finance
Posted in financial |
Posted by Samantha & Nicole
26 Nov 2007

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