Should I Invest Now Or Try To Save Money To Buy A House Later?

09-07-24 10:58 AM - Comment(s) - By Joean

Should I invest now or try to save money to buy a house later? We are frequently asked this question, and the answer depends on a wide range of factors. The top concerns are:

FIRST OFF, HOW QUICKLY CAN YOU SAVE?

We cannot give you an answer to that, but a simple exercise is to consider how much money you've previously saved and how long it took.

DO YOU HAVE A BUDGET?

Creating a budget is essential for gaining a clear overview of your finances. It allows you to compare your expenses against your income, helping you identify any surplus or deficit. Once you understand your financial situation, you can start planning effectively. Consider your priorities carefully. Some individuals focus on rapidly saving for a home deposit, while others balance this goal with smaller objectives like planning a vacation or purchasing a vehicle.

Numerous online budgeting resources are available to assist you. We recommend exploring the free budgeting tool provided by the Australian Government's Moneysmart website.

To visit their website, kindly click the tab.

Australian Government Moneysmart Website

HINT: Take this opportunity to review all your automatic subscriptions. Do you need both Amazon Prime and Spotify or would one service be enough for all your needs? How about utilities? Could you negotiate a better deal with your electricity provider, or would you get a discount if you paid via direct debit? Little changes can really add up.

This is particularly relevant to our investors who want to buy in expensive cities like Sydney. This situation can be discouraging. If you find yourself priced out of your local market, consider investing in a more affordable area. This approach allows you to leverage potential capital growth to build your wealth over time, effectively letting property appreciation do the 'saving' for you. You can then later utilise the equity growth to put in the deposit for your home. Many of our Sydney and Melbourne clients employ the ‘rentvesting’ strategy, where they rent where they want to live and invest to make money. An added benefit is the tax minimisation you’ll likely enjoy through the tax system. Paying less tax to start your property portfolio sounds good to me.

Generally speaking, property is a long-term game and we don’t encourage speculation, so setting up your strategy for portfolio growth is important. For some investors, using a trust structure can offer potential benefits such as asset protection, tax efficiency, and estate planning advantages. However, the suitability of a trust depends on individual circumstances and should be carefully considered with professional advice. There are lending implications as well, and a good finance broker can take you through the specifics as it relates to your circumstances.

HOW TO MAKE IT A REALITY?

Calla Property can help turn your home ownership aspirations into reality. We specialise in identifying high-growth investment properties that can accelerate your journey to your ideal home. Our expert team will guide you through the entire process, from initial consultation to property acquisition.

DON'T HAVE A COMPLETE INVESTMENT TEAM YET?

No worries. We can connect you with top-tier professionals, including finance brokers, accountants, financial planners, and property lawyers. Together, we'll determine the best investment strategy and property vehicle to suit your unique needs and goals.

With Calla Property by your side, you're not just dreaming about your perfect home – you're taking concrete steps to make it happen. Why wait? Contact us today and let's start building your property investment future. Your dream home may be closer than you think.

Reach out to us at Calla Property and we can introduce you to your personal Calla Concierge Team.

Our motto is Building Your Dreams, and we work hard to create that for you.

It starts with just one phone call.

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Calla Property Investment Specialists:

+61 407 465 850 | +61 482 080 189