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5 Good Reasons to Consider Investing in Retirement Property

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5 Good Reasons to Consider Investing in Retirement Property

Category Investing

According to 10X Investments' Reality of Retirement report (2021), almost half of South Africans do not currently have a retirement savings plan.

Taking into consideration the typical loan repayment term is an average of twenty years and for the first couple of years your payments only cover the interest on the loan, it is financially prudent to consider investing in a retirement property at the earliest possible opportunity.

Why should you buy now?

#1 - Long-term investment

Whether you decide to spend your later years at the coast or in the bush, retirement homes in estates and villages are in high demand and this creates a competitive market with excellent long-term investment appreciation.

Although there are many investment opportunities available, the property market in general is inclined to be more stable and with careful selection, provides an excellent return on investment.

#2 - Rental Income

Securing a retirement property at a young age means you can increase your investment potential by renting out the property for additional income until you are ready to retire or sell the property.

It is important to remember, before investing in a property, that the rental income generated should be in line with, or higher, than the rate of inflation and provide the same living standards in the future as your current standard of living.

#3 - Security and lifestyle

Most modern retirement properties currently on the market are situated in estates and villages with sophisticated security systems and for those who enjoy travelling, offer a stress-free, lock-up-and-go lifestyle.

Other important factors to take into consideration when buying a property for future retirement are the amenities and facilities on offer; these include sporting facilities, healthcare and entertainment.

Eco estates are a popular choice with investors as the housing developments have a sustainable lifestyle focus and have been built with minimum impact on the environment as well as the conservation of natural resources.

#4 - Financial security for the future

Nobody can say for certain what the future holds, however, we are living longer and healthier lives and taking the time and effort now in our younger years to plan the ideal retirement lifestyle will provide peace of mind for the future.

To ensure the best financial investment, you may wish to consult a financial expert or a property specialist to advise you on earning potential, sought-after locations and tax implications.

#5 - Generational legacy

Aside from ensuring you enjoy your "autumn years" to the fullest, financial stability for your next of kin is an important consideration.

A distinct advantage of owning a full-title ownership retirement property presents an opportunity for the investor to leave a financial legacy behind for their children and grandchildren as the property then forms part of the estate and thus, in the terms of a will.

In closing

We have all no doubt heard the phrase, "time flies", and looking at the benefits we have explored, any buyer should agree that it is never too early to start investing in a retirement property.

Author Jack Russell Estates
Published 07 Nov 2022 / Views -
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