Capital Growth vs. Rental Income – The Great Debate

Arguments often break out between advocates of these two approaches as to which are the best; to invest for growth or cash flow?

While it’s important to remember that the two aren’t mutually exclusive, it is absolutely possible to invest in property that returns both strong positive cash flows and capital gain. You just have to find it – or wait patiently for it.

Some property investors regard themselves as either ‘growth’ investors or ‘income’ investors. The difference being ‘growth’ investors is that they look for property that will increase in value quickly, whereas ‘income’ investors would rather rental returns to cover the costs associated with owning a property, so it doesn’t cost money out of their own pocket every week.

Scott Mackey, Principal of RE/MAX Precision, says “in regional areas, it’s possible to locate lower priced property with comparatively high rental yields. This is a strategy that many ‘income’ investors choose.”

“The capital cities offer historically higher capital gain, but also a much higher initial investment of capital.”

“The best investments are those that offer both good capital growth over the medium to long term, and strong consistent cash flow that becomes positive over the time in which the property is held,” says Scott.

There’s no doubt that the Bundaberg region is experiencing a housing market boom. There is great demand for rental properties, offering a reliable flow of rental income.

Will you also be able to match that with capital gain? Contact us today and we’ll take you over some of our excellent listings that could do just that.