Property interest me A LOT as i have seen some very smart investors/developers make huge gains in relatively short periods of time.
I believe in having a diversified portfolio, of which property is obviously one arm of diversification.
I do not plan to divest one asset class ie shares, bonds, forex in order to enter another ie property. My view is to use gains in one asset class to diversify into another. Again i believe in a diversified investment portfolio.
I am fortunate enough to already have a small property portfolio. I believe there are gains to be made. I tend to target country areas that have houses available for relatively low prices $120 - $250k with a good opportunity for growth ie - fundamental factors driving demand. Furthermore I look for a rental yield of no less then 7% which not only amortises the loan on a P&I basis but also provides small surplus cash flow to cover fixed costs ie - rates.
Given high prices, low yields and relatively low opportunites for capital growth in capital cities (my humble opinion) I dont personally see any upside in properties in australia capital cities at the moment. this is of cause only my opinion.
