Better off to rent than to buy property?

[HIDDENGEM]

It dependson the situation, risk level, income level, age, job or income security in thefuture.

Just like otherexperts in other investment areas those who good in property will do betterthan others.

First homebuyers should not buy properties when they see prices are in peak level.

It isbetter to avoid any type of asset when they become overvalued.

We shouldhave idea about property cycle and business cycle as well.

In someperiod some assets can appreciate rapidly and in some period these assets cango down rapidly surprise to many. Through out the history this happened to manyassets such as gold, shares, property and currencies. Time to time there werereal estate, credit, gold and currency crisis globally.

After peakin 2007 during last two years we saw rapid price depreciation in property marketin many countries except New Zealand and Australia. We have uncertainty in the property marketnow. Whether to buy now or later.

Owninghouse is a good thing. Instead of paying rent we can have our own house by payingmonthly instalments


NB:

My opinions are not intended as financial advice. Pleasedo your own RESEARCH.

[fungus pudding]

Now you know why I have an obsession about dividend paying stocks :-)

I also think you need to be careful about revolving credit loans - either those, or offset ones, cant remember which, but one of them does not qualify as deductible. I prefer the simplicity and separateness of an interest only line of credit, with the interest paid off in full each month from transfers from my savings/dividends account. The beauty of current markets is that you can be positively geared into the market. Not something you can say about residential property (at least in Australia).

It doesn't matter a toss whether it is revolving credit, floating, fixed or a loan from Uncle Fred. Neither does it matter what security money is borrowed against. The test for deductibity is the intention to gain income.

[lou]

Now you know why I have an obsession about dividend paying stocks :-)

I also think you need to be careful about revolving credit loans - either those, or offset ones, cant remember which, but one of them does not qualify as deductible. I prefer the simplicity and separateness of an interest only line of credit, with the interest paid off in full each month from transfers from my savings/dividends account. The beauty of current markets is that you can be positively geared into the market. Not something you can say about residential property (at least in Australia).

Hey KW

As Fungs Pudding pointed out deductibility depends on the intention of the loan.
Where revolving credit loans and offset loans fall down is the intention of the loan can be lost if you are using it for business and personal expenses. If you are only using it for business it will be 100% deductible.

[Spyder90]

Thank you everyone for their different thoughts the perfect insight I needed. All the best to all

[voltage]

fungus pudding your thoughts on borrowing to purchase dividend income shares are interesting. I have done this and include asx stock like banks but the problem with asx stock you cannot use franking credits and you pay tax twice on the dividend, once in aussie and then again in NZ. Shares are more volatile than property and it is very important to have a long term horizon.