Bad Investment? Here’s what to do next

Bad investments look like they are seemingly on the rise, however, it’s not the end of the world.

Let’s see! As the economy gravitates towards its new normal and real estate as we knew it has been strikingly impacted, the effects of a bad investment are more prominent than ever.

However, according to a property professional, having a lemon in your portfolio is not as bad as you may think.

Investment Director of Wealthi, Stephanie Davies believes bad investments aren’t a dead end but rather an opportunity to learn from imminent mistakes and make a change going forward. 

Wealthi recognises that so many clients coming into their world believe they have made a wrong turn before. Making the clients value the Wealthi experience, and their service, data and predictive analytics that they provide and use, ensure that they are working on the best investments in Australia.

Identifying what makes it bad, is really important – is it that the yield is so high, that you are not getting the tax advantages and capital growth which may suit your situation better? Or is the yield too low and crippling your cash flow?

The Investment Director acknowledges a bad investment will always make a good one so much sweeter.

Currently, the uncertainty in the market is uncovering opportunities to capitalise on the incentives and cash flow requirements of businesses that are trying to adapt to the changing market conditions, this doesn’t suit everyone – but definitely a space to watch.

The first step towards a good investment is tailoring it to the individual situation and purpose of acquisition. Investments are wealth creation vehicles that have many moving parts. Recently referred to as ‘moving plates’, this analogy is exceptional because there are often many influential factors that are not necessarily linked to the initial purchase. 

Take a yield vs cash flow strategy for example: there are so many things to consider that what’s good for one might not be for the other.

But what Wealthi is seeing in the market is that buyers are asking more questions. Smart questions.

These smart questions, and subsequent questions, considerations and conversations are all vital to any purchase and this will better educate investors.

So, coming out of COVID, the investment director believes that many savvy investors will have reviewed their property situation holistically and will be far better off.

Main image source: Shutterstock (sommart sombutwanitkul)

Lowest interest rates for 1-year fixed home loans

The comparison table below displays some of the 1 year fixed rate investment home loan products on Canstar’s database with links to lenders’ websites available for a loan amount of $350,000 at 80% LVR in NSW, and available for Principal and Interest repayments. The results are sorted by ‘current rate’ (lowest to highest), then by provider name (alphabetically).

*Comparison rate based on loan amount of $150,000. Read the Comparison Rate Warning.

Lowest interest rates for 3-year fixed home loans

The comparison table below displays some of the 3 year fixed rate investment home loan products on Canstar’s database with links to lenders’ websites available for a loan amount of $350,000 at 80% LVR in NSW, and available for Principal and Interest repayments. The results are sorted by ‘current rate’ (lowest to highest), then by provider name (alphabetically).

*Comparison rate based on loan amount of $150,000. Read the Comparison Rate Warning.

Lowest interest rates for 5-year fixed home loans

The comparison tables below displays some of the 5 year fixed rate investment home loan products on Canstar’s database with links to lenders’ websites available for a loan amount of $350,000 at 80% LVR in NSW, and available for Principal and Interest repayments. The results are sorted by ‘current rate’ (lowest to highest), then by provider name (alphabetically).

*Comparison rate based on loan amount of $150,000. Read the Comparison Rate Warning.


About Stephanie Davies

Stephanie Davies

Stephanie Davies is the Investment Director of Wealthi, a property investment technology platform acquiring tailored investment properties Australia wide. Wealthi is a real estate investment platform. Their mission is to help people build wealth through property, so they can achieve their life ambitions. Wealthi provides the roadmap, tools and expertise to guide and simplify the entire journey.

This article was reviewed by our Content Producer Isabella Shoard before it was published as part of our fact-checking process.

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