Gen-Y Positive tactics using Negative gearing gives them Positive Property Results

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A new wave of Generation Y investors is entering the property market and many are using negative gearing as their way to achieve long term goals

 

They are obviously using their brains instead of their hearts (emotions) when buying property. 

 

ME Bank chief executive Jamie McPhee said high prices had forced many young buyers to enter the market as investors instead of owner-occupiers. 

 

Young buyers are being very smart indeed in buying an investment property while they are still living at home or renting with a group of people by sharing accommodation while they get ahead financially.

 

Their financial situation quickly improves because they are reaping the benefits of Tax Deductions and all the other benefits of course, and when they have saved enough and are comfortable they can move into the home.

 

But many will choose to buy another investment property and build a Property Portfolio so they will be very comfortable in retirement.   

 

According to the Australian Bureau of Statistics, the number of first home buyers has fallen to a record low.

 

But these figures don't take into account those whose first property is an investment and the official number underrepresented the case. 

 

A recent national survey by ME Bank based on 1500 households found 15.3 per cent of Gen Y’s were saving for an investment, while 24.7 per cent intended to buy a home to live in.

 

A survey conducted by Mortgage Choice in 2013 also pointed to a new generation of home buyers using investments to enter the market.

 

The figures, based on about 340 Gen Y’s surveyed nationally, found 40% of them were looking for an investment property as their first purchase.

 

AMP Capital chief economist Shane Oliver, who also bought an investment property as his first purchase, said renting and investing had many benefits.

 

“Using the tax system - negative gearing - to get into the property market has a lot of benefits for first home buyers,'' he said.

 

''You can buy a property bigger or more valuable than one you can actually afford to live in and make it into a suburb you ultimately want to live in. It just means you may not move into your dream home for two or three years.''