How to build a financial strategy

What drives returns?

Historically the best returns on residential property have been through capital growth and not rental returns, and capital growth is driven by the increase in land value, not the dwelling.

As such, it is important to understand the key drivers of positive property returns based firstly on location of plot of land, and secondly on the dwelling itself.

We estimate that 80% of capital growth is driven by location, with only 20% driven by the dwelling itself. Said another way, history tells us that a great location with an average dwelling sitting on the land is a better investment than an average location with a great dwelling.

The home you live in and the financial gain made through property investment is critical when it comes to creating your ideal lifestyle.

If your next property purchase is an investment property, your aim is to ensure you make a quality property selection by taking into account the following key considerations:

  • Quality Location Selection.
  • Quality Asset Selection.

When we reach Step 3 – Property Select stage after you decide your Strategy which is determining whether your next decision is lifestyle or investment, the price range and macro location.

We will then narrow our focus on the micro location and asset type.


David is the Founder and Managing Director of Property Planning Australia, author of ‘How to Succeed with Property to Create your Ideal Lifestyle’, co-author of ‘Property for Life – Using Property to Plan Your Financial Future’, co-host of the ‘Property Planner, Buyer and Professor Podcast’ and a widely-published media commentator. With more than 20 years of experience, David is passionate about educating others to make informed, and ultimately, more lucrative property investment decisions. David established Property Planning Australia in 2004 – with the vision to educate and empower Australians to make successful property, mortgage strategy and money management decisions.  Property Planning Australia’s operations have earned acclaim and national industry awards for its unique fusion of property planning, education, money management, mortgage strategy and risk management. All supported by multi award-winning customer service.

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