If you are interested in real estate, then you’ll have watched in surprise, as the Australian property market defied all expectations in the past year. Property prices have headed skywards, at a rate not seen before. It’s truly dog eat dog out there, in the real estate market. The FOMO frenzy is driving people to hysterical decisions at auctions. House prices are rising at an unbelievable one thousand dollars per day.
An average wage earner has no chance of keeping up with that growth, in their quest to save a home deposit. These extraordinary increases in market value offer people a chance to build wealth, at a rate not available in any other form of investment, for the ordinary Australian.Of course, you’d love to be a part of this wealth building. But what can the average wage earner do to not be left behind ?
The shared investment strategy is now possibly the only way forward for aspiring homeowners, and likewise, shared property investment is inevitably becoming an increasingly important sector of the real estate market. Think about it. If you could buy an investment property in shares, with four friends or family members, the median house price, of around the one million dollar mark, is obviously divided into four contributions of $250,000. Of course, this split could be in different proportions, if some of the contributors are better placed to contribute funds. But, for our example, let’s keep it simple, and say the shareholders buy four equal shares.
You can secure a stake in the investment property, and your affordability hurdle is much lower. But, as a quarter shareholder, so is your risk. Now, if house prices do rise by another 20% this coming year, as is being seriously predicted – your profit share, at the time of flipping the property, is $50,000, minus your quarter share of the costs. Average wage earners have no chance of saving that amount of money in one year and, if your team were to pull that success off, you are now half way to having your own home deposit, on your own investment property, or your own home.
And you have achieved that in one year! Of course, you need to pick a good investment property, but again, a small property syndicate has multiple brains, pooled experience, and four times the energy and time, to research an astute property investment purchase. So, through shared investment in property, you win in many ways.
The Tenant in Common Exchange is set up specifically to support this approach to breaking into property investment, and starting on the journey to a home of your own. TicX guides you to a successful legal structure for your equity partnership, and offers you the elusive, and all important, liquidity to your share, with a well organised trading exchange for listing property shares for sale.
Discover shared RentVesting, through the Tenant in Common Exchange, www.ticx.com.au