4 Considerations When Buying An Investment Property For Your First Home
Have you thought about purchasing an investment property for your first home? This usually involves buying and renting out a property while continuing to rent yourself. Doing so can have significant benefits for your financial future. But there are a few key points to consider when deciding whether it’s the best course of action.
1. Where Do You Want to Live?
We all have a dream home or area we want to live in. Yet as first home buyers, our top choice is often out of reach. If the area you want to live in is too pricey and living elsewhere is unappealing, owning an investment property as your first home is an alternative option. This allows you the opportunity to get on the property ladder and work your way up to becoming an owner-occupier in your dream house in the area you want to live.
2. The Area You Want to Live May Not Be Good for Investment
Even if you are able to buy a property in the area you want to eventually live in, it may not be the best financial decision from an investment standpoint. You could do better by choosing an investment property in a growing area and allow it to increase in value over time, all while maintaining your preferred lifestyle. The best investment could be in a different state or involve a property type that doesn’t suit you.
3. Your Ability to Access Grants, Concessions and Exemptions
One important thing to keep in mind is that you will likely be no longer be eligible for the First Home Owner Grant (FHOG) or stamp duty exemptions or concessions if you are buying an investment property for your first home. You are generally required to live in the property as your principal place of residence for six to 12 months in order to claim these benefits. However, you may be able to use the property as an investment property in the future.
4. Benefits of a House and Land Package
When you think of purchasing an investment property, you think of a property that is decades old and located in an established suburb or an inner-city apartment. However, house and land packages are great investment option as you can specifically choose the location, type of block and design. There’s also less maintenance and repairs due to the home being new. Most importantly, you can access depreciation, tax benefits and stamp duty savings, which you only pay on the land rather than on the house and land.
Want to Invest With a House and Land Package?
If you’re interested in buying a house and land package as an investment, explore some of our home designs. If you would like any more information about our services, including our financing options, please get in touch with the experts at McDonald Jones Homes. We provide new builds in NSW and the ACT.