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I would personally get rid of it ASAP and look at higher growth areas like the western corridor of South East Qld out to Gatton and the greater ipswich area where the Qld government has invested 16.9 billion dollars in infrastructure,a super max jail, universities,highways, all to be completed by 2011 to 2013, you can now leverage off your super to buy a proeprty in a self managed super fund, but speka to a super investment property company who understand the new legislation that came in Sept 2007, something like this could help you speed up the recovery process and you can always look at a negative geared property as a seperate investment. I would personally steer clear from strata fees and I look at hgh rent retruns with good infrastructure as well as a place that is suitable to more than one demographic, IE. I would never buy a one bedroom unit, I stick to 3-4 bedroom houses close to schools,amenities and in an area that there is growth based on the infrastructure going in to the area.
Good luck and do your own homework by keeping up with what different governments are doing to create urban sprawl.One more thing, you need to invest in the right areas, that is common sense and there are plenty of companies to help you do this and provide good information on why, people who paid big bucks in WA will suffer as there is not as much diversity of industry as there is in other areas, but it goes in cycles and you should factur 12 years it will double not the farcicle 7.2 years. The same as people who bought in new estatews in Bunderburg did 10 years ago as there was not enough going on there at the time and the rents were never going to stack up, I steer clear of places that offer a guaranteed rent return as it is usually built into the property price to begin with, each to their own though.
This is my personal view,Australia is a relatively new country and has strong growth as well as strong immigration levels annually. To say that property is a gamble is a bit narrow minded considering you have a housing shortage, rental markets on the increase and a government that can not afford to build public housing themselves. Inflation will always happen, prices will always go up, if they dont then the stock market will crash as will everyones super portfolio which rely's on share prices going up to make a profit.
15 years ago I was listening to people tell me that property could not possible go up any further, I smiled and bought up, I still buy up, now the people who were trying to talk me out of it are kicking themselves as they have done nothing.
Not only to I actively invest in property but I also recently used my super to borrow money to build a property and set up a SMSF, it is already increasing as is the rent every 6 months. Each to their own, but Im a 39 year old mum of 2 and I never have to work again if I dont want to and my kids are also set up and dont have to worry about having their own first home in Sydney whcih will be well over a million dollars by the time they move out in 8 years time.
I used an investment property firm for my first few purchases and then once I was comfortable with understanding it I started doing it myself and now I do the whole lot except for my SMSF which I dont want to invest the time in so it costs me $20 a week (1100 a year) and it is all done for me and regulated by asic/apra etc. It is not a unit trust, the properties I buy through my fund are mine 100% so I dont have to worry about other people making bad decisions and after the GFC for me personally im glad I didnt have any of my money in super funds as i would still be behind and it would take me 3-4 years to amke up what the fund I was in lost. Each to there own, but every self funded retiree that I know owns a few properties and has a steady income stream that no one can tell them what to do with or limit the amount they want each week. But Im happy for people to continue thinking that property is a bad investment as the less people that buy their own house the more people out there to rent my properties.I got sick of paying expensive fees being a part of the super fund that the company I worked for put my guaranteed 9% in, I worked out that even if I contributed myself I was still not going to have enough based on the previous 10 year average annual returns. There are a lot of grey areas it seems when companies post their annual profits including it being almost impossible to find out exactly how much in fees were taken through investing,managing etc. I was paying a weekly amount for a fund manager I had never spoken to let alone have any idea what my super was being invested in.
I spoke to a few people and was referred to a company who had been going for over 20 years and with new legislation allowing a SMSF to borrow money to buy a property, I followed their advice and now instead of paying unknown fees and getting unknown returns as well as worrying about if my super will be there when I retire, I have been able to use my super as a healthy deposit, the rent and my 9% guarantee more than cover the loan and all expenses, the surplus reduces the loan and provides more equity to build a portfolio through my SMSF. It costs me $1100 a year to manage through the company and that is my tax and auditing for the fund, roughly $20 a week which is nothing compared to what I was paying and they do that all for me. Now my super will grow roughly 10% per year from the value of the whole property instead of making Maybe making 10% annually just on the amount in my company fund which was bugger all based on my own statement over a 12 year period, for 3 years they lost money as well as all my conributions, and no excuse and the directors still got paid masive salaries for losing my money as well as everyone else's.
For me personally, having a SMSF and using super invest properties and Sunpac was the best thing I have done as now I have my own strategy and I can also contribute my own money through salary sacrafice as well as reduce my taxable income and have even more money for retirement. Not only that, but I am not limited to how many properties I can acquire or any particular area.
