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Investing in Real Estate

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Why do we need to Invest?Age Pension - $22,776 for singles P.A. or $33,982 for

a couple.(human services.gov.au: September 2015)

How much is needed for a comfortable lifestyle?

Industry experts suggest $42,861 for singles p.a. or $58,784 p.a. for a couple in today's dollars. (moneysmart.gov.au)

Even at these figures you would have to be careful with your spending.

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Keys to Real estate InvestmentTime not timing (Australian share market 1900 to

2008)

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ASX All ords index 1988 to 2015

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Australian Median House Prices 1960 to 2006

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ACT Median House & Unit price 1999 to 2014 (allhomes.com.au)

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Yield & Capital Growth

Yield = rentCapital growth = property value

timeRight types of property DiversificationWe want Growth driven property.

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Negative GearingIs the difference between the total of all costs &

your rent.Depreciation.

Building Depreciation = cost of building x 2.5% over 40 years.

Fixtures Depreciation = cost of fittings x 20% on average over 5 years.

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So how do you pick the right Property?

The 4 Elements of selecting Real estate

1.Buy in todays dollars2.Select the right location3.Select the right plan type4.Select the right

Builder/Developer

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Referenceshttp://www.superguide.com.au/superannuation-

basics/a-comfortable-retirement-how-much-super-is-enough

https://www.amp.com.au/super/supersimulator/ampss.html

https://www.moneysmart.gov.au