Surveys of property investors have confirmed that although investing can be a fantastic way to build long-term wealth, investors need to be prepared to weather periods of negative cash flow, especially in the early years.
The Property Investment Professionals of Australia (PIPA) found that 65% of the investors they surveyed were negatively geared in 2024, up from 57% in 2023.
PIPA chair Nicola McDougall said the results confirmed that being a property investor involves both upsides as well as challenges.
“Interest rates remain significantly higher than they were a few years ago and, while rents have risen, they are a drop in the ocean compared to higher lending costs,” she said.
If you’re a property investor, here are five tips for managing your financial position:
- Build a cash buffer to cover periods of negative cash flow
- Factor in rising interest rates when budgeting future costs
- Work with an accountant to maximise your tax deductions
- Review your loan on a regular basis to ensure it’s still competitive
- Speak with a mortgage broker to explore refinancing or restructuring options
If you’re thinking about buying an investment property or ensuring an existing investment loan is structured correctly, I can help.
