The Australian dream - why rent when you can buy?

‚ÄčIt appears that some people are still in the mindset that owning a property is an unattainable dream. Part of the great Australian dream is to own your own home, and whilst many people do, there is still a large proportion of the population that elect to rent rather than buy because they don't think they can afford it.

According to a recent report by RP Data, there are many suburbs in Brisbane, including the CBD, where the average rent is higher than the average cost of paying a home loan. So instead of paying your landlords mortgage you could be paying off your own mortgage for the same price!

If you like the suburb you are living in, but know you can't afford to buy there, why not think about buying an investment property? It is becoming increasingly popular for people to continue renting in their preferred suburb, and to buy an investment property in another suburb and rent it out. By doing this you are benefitting by owning a property, and your tenant's rental payments are helping you pay that mortgage off.

It's important to realise that there are also some tax benefits of owning an investment property over an owner occupied property. Negative gearing is a possibility for some borrowers and I recommend that you should have a chat to your accountant to see if it would work for your situation.

I think that there's no harm in doing some research to see what the average property price is in your chosen area, how much you would be able to borrow and what the repayments would be. Sometimes, the best step is to start investigating, you might be surprised with what you find!


By Marie Mortimer. You can follow Marie on Google+

Image credit: ywel

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