Why do/did you invest?

Discussion in 'Investor Psychology & Mindset' started by THX, 12th Oct, 2015.

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What is your primary motivation for investing in property?

Poll closed 19th Oct, 2015.

  1. Tax benefits (Negative gearing)

    3 vote(s)
    4.2%

  2. Tax benefits (Capital Gains Tax discount)

    0 vote(s)
    0.0%

  3. Short term capital growth

    1 vote(s)
    1.4%

  4. Long term capital growth

    27 vote(s)
    37.5%

  5. Ability to leverage

    4 vote(s)
    5.6%

  6. Passive income

    36 vote(s)
    50.0%

  7. Other

    1 vote(s)
    1.4%
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  1. THX

    THX Well-Known Member

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    I know the question has been asked before but results were more of a personal nature of why you might invest. I'd like to know the primary financial reasons you invest in property vs other investment classes.



    *Any others responses needed? and I know there is no one reason, but what was your most important reason.
     
    THX, 12th Oct, 2015
    #1
  2. HUGH72

    HUGH72 Well-Known Member

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    I voted long term CG but I want to retire on rent so I would have also voted for passive income.
     
    HUGH72, 12th Oct, 2015
    #2
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  3. House

    House Well-Known Member

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    I'm investing for both but chose cashflow as that's the ultimate outcome I'm looking for.
     
    House, 12th Oct, 2015
    #3
  4. hobo

    hobo Well-Known Member

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    When I started investing my goal definitely included long-term capital growth (and it still does), but ultimately I wanted to achieve a certain level of passive income so that I could live my life how I wanted - so I voted Passive Income.
     
    hobo, 12th Oct, 2015
    #4
  5. wylie

    wylie Moderator Staff Member

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    This sums us up too.
     
    wylie, 12th Oct, 2015
    #5
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  6. Ace in the Hole

    Ace in the Hole Well-Known Member

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    Well, to get financially rich in general was the main reason, but that's not a poll option.
    What made me choose property was that I liked renovation/building/real estate.
    To answer the poll, being able to leverage would have been the number 1 choice for committing to property investment as a get rich tool.
    Without leverage, most would get nowhere.
    Growth wouldn't matter if you couldn't get into the market in the first place...

    We haven't even been through a full cycle yet with IP's, but have accumulated more than enough now because of leverage available.
     
    Ace in the Hole, 12th Oct, 2015
    #6
  7. D.T.

    D.T. Specialist Property Manager Business Member

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    There's a couple of answers there I liked - end up going with the passive income one as per Hugh et al above me.
     
    D.T., 12th Oct, 2015
    #7
  8. Ed Barton

    Ed Barton Well-Known Member

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    Balance.
     
    Ed Barton, 12th Oct, 2015
    #8
  9. cdchi1

    cdchi1 Well-Known Member

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    I invested in property simply because the family home my dad (RIP) brought for around $30K was worth around $1.7M in 2000 (the year I decided to co-purchase my first property). I co-purchased first property in Carlton North with my 2 cousins. I then co-purchased one in Elwood in 2001 with my mother. Both have been great capital growth investments, particularly Carlton North which has more than tripled in price.

    However, soon after my second purchase I moved into equities and it turned out to be a good move making significantly more than I could make on property investment though admittedly with a significant amount of luck.

    Having made it in equities though I considering moving back to property for security reasons though again I'll be focussing on cap growth rather than rental income. I figure if you get high capital growth the rental yield (based on initial purchase price plus any reno costs) will look after itself. For example, the house in Elwood purchased had a yield of around 3% when I bought it. With rental increases, the yield based on original PP + renovation costs is now around 5.5%. Course based on market value it would probably still be around 3% but I prefer to look at it on outlay rather than market value.
     
    cdchi1, 12th Oct, 2015
    #9
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  10. THX

    THX Well-Known Member

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    What else are you invested in?
     
    THX, 13th Oct, 2015
    #10
  11. BarneyRubble

    BarneyRubble Well-Known Member

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    Balance, is my philosophy too. My investments are around 50/50 between individual share portfolio and investment properties. I rarely hold cash, preferring to be fully invested.
     
    BarneyRubble, 13th Oct, 2015
    #11
  12. THX

    THX Well-Known Member

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    My wife holds all my cash :).
     
    THX, 13th Oct, 2015
    #12
  13. Ed Barton

    Ed Barton Well-Known Member

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    A very poor post by me - balance.

    Australian shares is mostly my other investment. I started in property by inheriting several properties. I then used income from those properties and business profits to buy more and build a share portfolio. I've never borrowed to invest.
     
    Ed Barton, 13th Oct, 2015
    #13
  14. skater

    skater Well-Known Member

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    I chose Passive Income, and although that is what we invest for now, it wasn't at the beginning. At the beginning we didn't really have any plans or goals, we just learnt by default that we could buy a second property & thought 'Why not?'
     
    skater, 13th Oct, 2015
    #14
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  15. DaveM

    DaveM Well-Known Member

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    HOW MANY HOUSES DO YOU NEED???!?!??
     
    DaveM, 13th Oct, 2015
    #15
  16. skater

    skater Well-Known Member

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    Haha! Sister-in-law said that to us after we'd bought our 3rd IP. We've not updated the family since then.:p
     
    skater, 13th Oct, 2015
    #16
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  17. MTR

    MTR Well-Known Member

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    1. Short term capital growth
    2. Long term capital growth
    3. Ability to leverage
    4. Passive income
    I can only vote 1, but I want to vote all of the above????

    So voted passive income:)
     
    MTR, 13th Oct, 2015
    #17
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  18. DaveM

    DaveM Well-Known Member

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    See I do pay attention to your stories :D
     
    DaveM, 13th Oct, 2015
    #18
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  19. EN710

    EN710 Well-Known Member

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    leverage and passive income?
     
    EN710, 13th Oct, 2015
    #19
  20. EN710

    EN710 Well-Known Member

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    A lot! Because all of them are owned by the bank :rolleyes:
     
    EN710, 13th Oct, 2015
    #20
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