Property investment companies in Australia   The development of residential property in Australia provides private investors with an opportunity to earn high levels of income.   Developers welcome the participation of private investors in residential property by forming investment companies to assist with financing.   The investment company formed by the developer issues shares to private investors in return for subscriptions. Investments can be as small or as large as each investor wishes.   Investments of this kind in Australia earn between 7.00 and 15.00% interest per annum depending upon the risk of the investment. These returns are paid monthly.   The return is determined by these factors – n          Have the apartments been pre-sold to end users? The more that are sold the better. Construction in Australia usually begins when 50% of the apartments are pre-sold. If all of the apartments are pre-sold then the risk is greatly reduced. n          Is the project backed by a major bank which is providing most of the construction finance? The Australian banking system is very rigorous and construction finance from a major Australian bank is a sign that the project has been well conceived and executed. n          Is the developer experienced in the type of development being undertaken? Developers in Australia tend to specialise. You need to look for a developer that has an established record for delivering completed projects which are like the investment opportunity. n          Is the builder a reputable contractor who has a good relationship with the developer? This is key to the success of the investment. You should look for evidence of a strong relationship between the developer and the builder. n          Is the project at the affordable end of the market? Investors who are buying apartments at the affordable end of the market are more likely to settle than owner/occupiers at the higher end of the market. The lower end of the market in Australia is $500,000 and under for a finished apartment. The higher end is anything above $1,000,000.   Residential developments in Australia remain viable because our population continues to grown each year. We have more births than deaths, more people coming to the country to live than leaving, and like all countries in the world, we have shrinking household numbers. Therefore, the demand for well planned apartments is very steady in our capital cities.   Apartment living in Australia has become very popular. In our major capital cities up to one third of people live in apartments. This is the result of concerns about the environment and a desire to live closer to where people work in the cities. It is also more likely that young Australians will choose to live in apartments because of their inability to afford more expensive land and housing options.   When investing in a company that is assisting with the finance of a residential project you should first look for a return that represents fair value and relates to a project where the risks have been well managed.   Information Supplied by: Pan Urban A’Beckett Ltd Phone: +61 1800 055 508 Website: www.panurban.com/invest