Prices always rise, and if you hold onto something for an extended period of time, you will ride out the effects of any crash, and your property will appreciate to a value greater than what you purchased it at.

However, the biggest indicator of future trend is the rental market. For as long as the rental market continues to increase, rental prices will continue to rise. This will have the flow-on effect of requiring more housing to be built. As long as housing remains in demand, the values will continue to appreciate.

This is the attractiveness of property investment at the moment.

The trick, of course, to minimising your risks is to make sure you purchase property in a developing area which has government support for the placement of social infrastructure, like highways, schools, shopping centres, etc etc. This will only help your property appreciate.

So yes, I’m aware of the risks, and aware of how to minimise them.

Your property investment ideas are essentially correct, however there’s no such thing as a quick buck or guaranteed money - that’s life. Trust me, I’m from a family who, between us, own 9 or 10 properties.

The tax benefits are always a plus, but the biggie is the capital growth in property. The trouble is that all indicators point to property prices being at a peak. Just take a look at what’s happening in the USA, different market, but don’t ever kid yourself that we aren’t immune to the goings on in the states. The whole game can change drastically when the house price arrow is pointing downward and not upward.

Another word of advice is to watch out for high risk loans. Those lenders will be the first to come knocking on your door when they are doing it tough. Check out what’s just happened to Northern Rock in the UK.

Anyways, words of advice from a property pessimist.

Warwick

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