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Redlands Real Estate

31-35 Middle Street Cleveland

07 3286 1266

07 3286 1241


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30 Sep 2011 Cleveland 0 Comment

It’s great to own the property you live in. Not only can you decorate the place exactly how you want it, but it’s a significant step in becoming financially independent as well.

One significant benefit is that you will actually start to systematically save money. Paying rent just sees dollars flow away to the landlord, but paying a monthly mortgage returns the principal portion to your pocket. And with inflation in the picture, your mortgage payments will get relatively cheaper as your income goes up.

Another way of looking at things is what will happen when you retire?

If you are a renter, your rent will be constantly advancing with inflation, and your fixed retirement income will increasingly decline as your rent eats into your savings.

The forces of inflation are what really makes the difference. As a renter you will constantly witness rent increases. The lure is having a greater disposable income in the early stages of renting. But over time this advantage disappears.

The way mortgages are generally structured, the early years see more interest than principal being paid off. But as the years advance the opposite becomes true. Not only this, but other investments you make are taxable, where as all the capital accruements in your own home are tax free. You are also in a much better credit position should you need to apply for a loan.

If you have a real estate need or question, feel free to phone me on 07 3286 1266 or call into our office cnr Middle & Doig Streets, Cleveland

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