26 Jul 2024
Friday Tidbit
- Posted by Dejan Pekic BCom DipFP CFP GAICD, Senior Financial Planner
Buying a primary residential property in Australia is one of the best if not the best investment schemes ever created in this country.
It just does not get better than this, with residential property prices rising and the capital gains being tax free on your primary residence.
Owning a primary residence has been used by most of our clients for decades and will continue to be used going forward because of the tax advantaged status of owning the primary residence.
Click to read.
The problem however is that once built the residential property provides little in the way of future GDP (Gross Domestic Product) for the country.
Meaning that you can have $3 million or $5 million or $10 million or even more tied up in this one asset that produces nothing.
Sure, you can employ a cleaner and or a gardener but that will only deliver on a few thousand dollars of economic activity on an asset typically worth millions.
The whole policy around owning residential property is wrong as evidenced by the fact that it is so difficult for first home buyers to purchase a primary residence and the Federal Governments of the past three decades have done nothing to solve this problem.
Today, residential property prices are extraordinarily high and they should not be this expensive.
Our business is based on referrals, so if you have family, friends or colleagues that want advice please ask them to contact us.
At Newealth we are always looking to support and promote our clients wherever possible and if you have any ideas or comments, please feel free to email me or to call me on +61 2 9267 2322.
