Why to invest for the capital-haul

By Nina Cuturic

Recent CoreLogic market predictions have sent mouths dropping at figures indicating properties could soar well into the multi-millions within a quarter of a century, if the housing market is to continue rising by its long-seen rate of 6.8% per annum. Ben Nash, financial advisor and author of Amazon best seller, Get Unstuck, reveals how what’s to come can put investors in prime financial gear if they are willing to practice patience.

“Sure, there are some other strategies that have no doubt generated good returns for others over time. But, if you can get these sorts of returns from simply buying and holding a property for the long term, why do you need to push harder?” the founder of Pivot Wealth asks in reflecting on forecast trends – which say houses in Sydney could reach a median value of over $6m by the year 2043.

It’s a steep growth rate, considering CoreLogic data lists Sydney’s median house value to be around the $1.1m mark at present.

In acknowledging that industry predictions involve “some big numbers” at play, Nash advises that these can be leveraged “from buying a good property and holding it for the long term”. It’s all about leaning on capital growth and recognising your property as an asset that will build in value over time.

Buying and selling properties within short periods of time, compared to buying a holding property for the long-term, often involves something Nash describes as “timing risk”. It’s the unfortunate chance of selling your property at the “wrong point in the property market cycle”.

“You can lose money, or not make as much, as a result. And above timing risk, you have to cover the cost of buying and selling property,” he says.

Sitting tight and letting the market develop over an extended period of time is an effective way to accumulate assets and wealth, without the certain risks that can come with other investment avenues such as buying multiple properties, or the cycle of buying and flipping then selling on.

Although “settle” is not considered one of Nash’s most favourite words, he trusts that “settling for good returns over time can be a smart play”.

“It takes some work to get there, but you can see the payoff is worth it,” he says.

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