Real estate prices have grown significantly over the past few years in Australia. Due to this growth, some buyers find it difficult to purchase a home in their preferred location. Many Australians want to live the dream and own their own home, however if you can’t afford to own a home in your ideal location there is an alternative.
Rather than being an owner-occupier, many people are renting a home in an area that they want to live in and buying a property in an area that they can afford. This property strategy allows people to have the best of both worlds. By choosing to do this, buyers may be able to make a property purchase sooner than if they had to save a deposit for a home in the area they wanted to live in. There are also other advantages to owning an investment property and renting where you want to live, such a taxation benefits.
If you are able to build equity in an investment property, you could use it to finance a purchase in the area you want to live in at a later date. Alternately, you could use the equity to purchase additional rental properties and create a portfolio of investment properties.
Buying where you can afford and renting where you want to live won’t be the answer for everyone, but it can be a useful way for some to enter the property market when they might otherwise struggle to do so.