Bricks and Mortar can still equal lifestyle!

After watching the story ‘The Big Squeeze’ on 60 minutes last Sunday, it certainly got us thinking, crunching numbers and stirred debate amongst the social networks.

http://sixtyminutes.ninemsn.com.au/videoindex.aspx

The reporter was interviewing numerous worst case scenarios surrounding the practice that rent money is not actually dead money and that it can be more financially beneficial than having your money tied up in Bricks and Mortar via owning your own home.

The stories covered families that were all struggling to pay their mortgages on their dream homes and several stand to lose the lot, not just the dream home but life savings and relationships that have suffered strain along the way.

In the current market, many families are being ‘forced’ to sell their homes because of interest rate rises, however they end up losing more money selling in a down market.

The flip side were the families who experience freedom and flexibility by renting their dream homes, as opposed to owning.

“Rent money is only dead money if you don’t invest the equivalent somewhere else. If you look purely at the numbers it makes more sense to rent.” said Chris Gay, Property Analyst.

Dionne Wilson, Director of Harcourts City Residential comments after watching the program….

“Rent the home you want to live in but buy an investment property where the numbers stack up.

Bricks and Mortar are solid over time. If you’re not going to be living in it you won’t over commit. We always spend more than we should when we’re buying for ourselves.  If you buy without emotion and do your numbers for a worst case scenario you won’t find yourself having to sell in a down market. The only time you’ll lose money in bricks and mortar is if you are forced to sell in a down market or if you are not insured for unseeable events. We all aspire to the best lifestyle we can afford and if that comes from renting that lifestyle, then having a tax effective bricks and mortar investment for someone else to afford then that makes perfect sense.”

For professional advice on buying and selling your home or investment please contact our office to have a chat with one of our property specialists 03 9664 8100 or you can email us at reception.cityresidential@harcourts.com.au

Leave a Reply