further encouragement to buy property

  1. 2,527 Posts.
    Just got my tax return figures. Biggest return I have ever had was around $500.

    This years was in excess of $10k.

    Yahooooo...

    My accountant claimed every bloody thing you could imagine for my properties (and my studies and other things, but bulk of refund is owing to my properties).

    What a great investment tool:

    You can leverage the sh*t out of yourself.

    I never made a deposit when purchasing, so the only money I have spent on mine are my interest repayments, probably 25k or so last year, collecting 12k or so rent, leaving me out of pocket 13k whilst having 300k of property working for me (a bit over 95% leverage!).

    Tax benefits.

    Money I spent fixing various things up to improve my investment, and in some cases add value, can be claimed and put something back in my pocket.

    Not to mention the difference between interest and rental return.

    Not to mention travel, depreciation on fixtures (haha right down to power points!), depreciation on bloody carpet, curtains, ovens, the buildings themselves, the old gum tree out the back, lol I never knew so many things could depreciate.

    Forced savings.

    If it isn't nailed down, I will spend it. Having a home loan has forced me, an impulsive young guy with a pretty active social life, to put some of my wage towards something for my future. I wouldn't have saved the money, I wouldn't be buying shares every time my months wage comes in, and I wouldn't be buying any paintings or gold!

    I also can't withdraw from my home, at least not easily (e.g. would need to borrow against it, makes it harder to do impulsively).

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    I am sure there are many other benefits I have missed, but wow, I can't think of an investment vehicle that offers me such great leverage, tax benefits, and forces discipline I wouldn't otherwise employ.

    Oh, but prices might drop short term, unlike the other investment vehicles. Shucks...


 
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