The Main Types of Mortgage for Making a Property Investment

Investment Property

Suni If you want to make sure that you will be financially steady in your future (especially if you are going to retire in a fairly short amount of time), then you will have to start thinking of ways in which you can invest money now, to profit later on. Although the economic crisis has been tough on the real estate market, the truth is that this is still one of the safest things to go for when it comes to investments.

Making a property investment will most likely mean that you will have to take a mortgage loan as well. Before you make any move though, do make sure that you understand the various types of mortgage loans out there, because this can influence a lot whether or not your property investment will actually turn out profitable.

The first and most common type of mortgage is the fixed-rate one. This…

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Home vs investment property: What to buy first?

aussie-moneyYou no doubt have been brought up believing that owning your own home is the ‘Australian thing to do”. Renting is just throwing away money and you need to buy your own home so you’ll be able to retire. So the usual steps goes something like this:

1 – Save up a deposit (with or without assistance).

2 – Purchase your PPOR (Principal Place of Residence).

3 – After you have built up equity in that home you consider either renting it out and purchasing a new PPOR, or you look at buying an investment property.

But is this the smartest move?

If you purchase your PPOR first, it can weaken your long-term financial position, because you have an increase in cost of living. It is highly likely it will cost you more to own your own home than to rent. Not just because of your mortgage, but through maintenance…

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