4 BIG MYTHS ABOUT REAL ESTATE INVESTMENT

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 Real estate is attracting a huge number of investors, people are getting obsessed with property, whether it’s our TV shows or our daily lives, we are discussing housing prices, planning the home renovation, or buying up flats to rent. But, is it the right kind of investment for you? Are you aware of the risks and situations which can arise along the journey? Since it is the topic on which everybody has different opinions, which gives life to so many myths that it becomes difficult for an investor to make a difference between fact and fiction. Property advisors in Melbourne have listed some of the most common myths which wander in the property market to help you decide whether this business is right for you.

HOUSE PRICES WILL ALWAYS RISE

The reason why property investment benefits those who have massive holding power is that every once in a while, the market witnesses a downfall, and those who don’t have enough holding power fall with the market. It’s clearly a myth that property prices will always rise, and it attracts so many novice investors which eventually try to find an exit when the market drops.

PROPERTY IS A LOW-RISK INVESTMENT

There is no business without risk nor is property investment. It is surely a secure way to invest money but risks are involved in any way. You can’t make out the average prices and act accordingly. There are so many micro markets within the market in which property prices fluctuate within a mile of each other. The only people who can help you in this situation are expert local estate agents or find reliable mortgage brokers in Melbourne.

YOU CAN’T MAKE MONEY FROM PROPERTY ANYMORE

Again, as mentioned above, property investment is about holding power, but that doesn’t necessarily mean that small investors can’t make money in this business. Real estate may not make a fortune for you if you are in to “fix and flip” business but it still won’t disappoint you if you make your decisions wisely. The nice thing about the property market is how bad the conditions are. You can always make money, you just need to educate yourself about the market trends and get good tax advice.

BUY-TO-LET IS THE BEST INCOME SOURCE

This myth has been in the market for years. An experienced financial advisor will make you a 4% return today and if all went well, you’d be lucky to make that return from buy-to-let unless you had a house of multiple occupations and were renting out rooms. You need to include the costs linked with property ownership, including maintenance, as well as ways to cover the mortgage if the property is empty.



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