How Property Investment Could Fund Your Retirement

Many empty nesters are disappointed to discover the financial plan they made in their 20s vastly underfunds the lifestyle they now want in their 60s and beyond. Settling into a retirement unit and living off a pension loses its appeal when all your friends are travelling the world, enjoying expensive leisurely lunches and upgrading to luxury cars and boats.

Do not despair however, because now is the perfect time to downsize in a strategic way and begin your new career of leisure and part-time property investment.

Now that the family have moved on, you can finally sell that rambling old house and downsize to something newer, that demands less maintenance and is infinitely more stylish. But before you do that, let’s consider a stepping stone approach to property investment.

1. Restructure the way your capital is invested

Using the capital from the sale of the family home wisely will establish a stronger foundation for positively gearing properties into your future. This, of course, can mean a stylish less expensive pad for you to live in but also a number of investment properties that will generate income over the longer term, securing the future for you and your family.

The first step is to sell your existing home, then wisely invest some of that cash, and take some of the rest of the money from the sale to buy a small, low maintenance investment property. Secure some decent tenants, make sure their rent covers the mortgage and you’re up and running!

2. Consider regional locations

The stylish inner-city lifestyle may seem very appealing but don’t let the bright shiny objects dazzle you into an emotional choice rather than a wise investment choice. With inner-city prices, out of the reach of the average buyer, many are looking to regional centres for both investment properties and lifestyle changes. Growth can be much stronger in these areas, yields are better, and over the longer term you could anticipate getting a much better return on your investment than a city property. Just do your research carefully to find those regional areas that have been identified in the media.

“Using the capital from the sale of the family home wisely will establish a stronger foundation for positively gearing properties into your future.”

Looking to areas where new infrastructure projects are in the works can be a good strategy. Areas such as Tamworth and Armidale in NSW, or Morwell and Mildura in Victoria have been seeing increasingly good results with yields on 2 bedroom houses, for example, much higher than ever before and higher than metropolitan results. When governments decentralise their operations into regional areas, the out of town growth potential becomes much stronger.

So, throw out those retirement home brochures immediately! Find yourself a good financial advisor and speak to our highly experienced agents for comprehensive advice about your new life as a semi-retired property tycoon!