to shares, cash
and fixed interest investments, property is a medium risk
investment potentially offering medium returns over the longer
Property investments can be used to achieve
either capital growth or income, or a combination of the two.
If you invest primarily seeking growth, your
investment horizon should be greater than five years. But, if
you invest primarily seeking income, your investment horizon could
be approximately one to two years.
Ways to invest in property
Direct investment in property is usually made through residential,
industrial, commercial or retail property. While there are advantages
to this form of investment and potentially useful returns, it
also carries disadvantages and risks.
Unit trusts and superannuation funds offer a number of advantages
over direct investment. While you have to pay someone else to
do the work, it allows you to diversify your risk and gain exposure
to a larger range of properties of potentially higher quality. Fees are generally
higher than those of other managed fund investments, due to the
higher cost of buying and managing property.
There are a number of companies on the stock market which only
invest in property. You can choose between retail, commercial,
or industrial property, or derivatives thereof.
Syndicates are relatively common, formed to allow the purchase
of, for example, a large single building. This form of investment
carries a greater risk than other forms of property investment,
including potential liquidity problems and lack of diversification.
These risks need to be balanced against the potential returns
of this form of investment.
Additional information and resources
with all investments, read as much as you can on the topic.
There are a number of useful "Books on property" in our Resources section you
could consider buying or borrowing. In addition, most of the books
in the savings and investment section include a few chapters on property investment.