Property

5 Reasons Why a Display Home Is a Wise Property Investment

Investing in property is one of the top ways to boost your income, but it’s not always easy. New investors will have their work cut out in a competitive property market where home buyers and potential tenants are looking for the best value at the cheapest prices.

So what’s the other option? Investing in display homes has grown in popularity recently. Since they are designed to entice potential buyers into purchasing a property, you can usually expect them to be built and maintained to the highest standard, and located in the nicest part of the complex.

Read on for five more reasons to choose a display home for your next investment property.

 

Reason #1: Guaranteed Return

When you buy a property, you would like to think that somebody will soon be interested in snapping it up, whether they’re purchasing or renting it from you. But, this isn’t always the case; there’s always the risk of your potential tenants finding something better and pulling out of what may have seemed like a done deal.

Display homes for sale in Melbourne will be rented back to the builder or developer for a period of around 1-3 years. So, it’s a safe investment to make – you can be certain of your first tenant.

Reason #2: Best Design and Landscaping

Property investors are always on the look-out for buildings that have the best layout and design. When it comes to display homes, you can’t really go wrong. Since these houses are used to showcase the rest of the development to potential buyers, they tend to have the most features to display the type of upgrades on offer.

In addition, display homes also tend to show off the type of landscaping available on the site. So, you can have a stunning garden ready to go.

Reason #3: Tax Depreciation Deductions

If you’re hoping to save money on tax when you invest in property, purchasing a high-quality display home could save you a significant amount. Since display home purchases tend to include a lot more – i.e. carpet, ovens, plant and equipment items, air-conditioning and more, tax depreciation deductions are reduced.

In general, you can expect to pay up to $10,000 per year in tax for the first two years of your investment.

Reason #4: Less Renovation Costs

In most cases, investing in property means that you’ll also need to pay for work to be done on the building before it can be sold on or let out to tenants. When you invest in a display home, there’s no need to worry about tenants ruining the place – at least for the first couple of years.

Once the initial tenancy is up and the home is yours to sell, live in or rent out, there’ll be less work needed to get the property up to scratch.

Reason #5: High Yield

Finally, the high yield on a display home investment is yet another attractive feature. Major builders advertise display homes for sale with yields of as high as 8% during the initial rental period.

There’s also a high yield potential for when you find another tenant for your property once the developer’s lease is up. Since display homes are new builds and tend to be in attractive new developments, these types of properties are in high demand.

 

 

About the author

Oliver Revilo