podcast

New versus old properties

Philippe Brach, Multifocus Properties & Finance

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Buying an old or new property is a very, very common question that I get. There is no right or wrong. Buying an older property that you renovate can actually increase it's value and also usually rents out a bit higher but on the flip side in an older property you've got a lot less depreciation. So it's all about numbers, it's all about working out what cash flow is on that property and the capital growth and have a nice balance between the two of them. A newer property will have more depreciation so it should be easier on your cash flow. What happens with new properties is usually a bit if a premium to pay compared to buying an older property. So it's a question of do you want a passive investment? Therefore you buy new and you're using property just to create wealth and it's a passive investment. Or do you want to have an active investment and actually participate in renovating? Therefore you can buy old, renovate, keep or sell depending on what your plan is.

 

Listen to other instalments of The Smart Property Investment Show:
Episode 78: Savings tactic: how house-sitting helps this couple save more money for property
Episode 77: How will the government's changes to tax depreciation impact investors?
Episode 76: SPI portfolio update: what's next for the team?
Episode 75: How travelling cross-country helped this investor buy 9 properties in 6 years
Episode 74: How this investor plans to double his portfolio within 10 years
Episode 73: Bad builders: how this investor bounced back
Episode 72: Policy changes to interest-only loans: what buyers need to know
Episode 71: How this 'stubborn' investor recognised a property lemon
Episode 70: How this investor complements each property and balances his portfolio
Episode 69: Are you a ‘lazy’ investor? Consider the benefits to working with a financial team
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