Apart from buying and owning a property directly, you may want to look at property investment trusts. Property investment trusts give you access to property assets but in a way that is different to owning a property yourself.
When you buy and own a property directly, there are large upfront costs and if you need to convert your investment to cash it takes time. On the positive side, you become the property owner and have control over the changes made to the property and who can live in it.
When you invest in a property investment trust, you’re buying a share in a portfolio of real estate assets―it’s like investing in a managed fund. You don’t have control over the assets but you also don’t have the upfront and ongoing costs that come with owning property directly. And you can convert your investment to cash straight away.
The money you invest is used by professional investment managers to buy and manage property in different sectors within the property market. For example, you can invest in office buildings, retail centres and hotels in Australia and overseas.
Investing in a property investment trust gives you access to the property market and may also help you save a deposit for a home more quickly. A debt recycling strategy combined with an investment in a property trust may even help you pay off your mortgage sooner.
You can invest in a property investment trust:
- as an individual investor
- as a member of a super fund
- through your self-managed super fund.
If you’re an employee—depending on the investment options provided by your super fund―you may be able to invest in a property investment trust using before- or after-tax dollars. And if you invest as an individual or have self-managed super you may be able to borrow money to invest and use the tax benefits of gearing.
When you invest in a property investment trust you’ll usually, but not always, buy and sell units in the trust through the Australian Securities Exchange.
Visit our AMP Capital website for more information about investing in property through managed funds.
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It’s important to consider your particular circumstances and read the relevant Product Disclosure Statement or Terms and Conditions before deciding what’s right for you. This information hasn’t taken your circumstances into account.
This information is provided by AMP Life Limited. Read our Financial Services Guide for information about our services, including the fees and other benefits that AMP companies and their representatives may receive in relation to products and services provided to you. All information on this website is subject to change without notice.