Investing directly and indirectly in property

Property investments are generally classified into 2 main categories. These are:

• direct property, and
• indirect property.

Direct property investments

When you invest directly in property, you purchase actual real estate either individually or with other investors within a syndicate.

Direct property investments can include residential, commercial, industrial and retail, properties. For the majority of investors, residential property, such as apartments, townhouses and houses, is the most favoured option as residential property is generally more accessible than investing directly in more expensive real estate assets such as shopping centres or office blocks.

Learn more about investing directly in residential property.

Indirect property investments

To gain exposure to properties normally considered too expensive for most retail investors, such as shopping centres, office blocks and resorts, you can invest indirectly in such properties.

When you invest indirectly in property, instead of buying physical real estate, you purchase units in a trust, such as a listed property trust (LPT), also known as an A-REIT (Australian Real Estate Investment Trust).

By investing indirectly in property through an LPT, you can buy and sell units on the ASX at any time, therefore providing a more liquid investment than directly owning a property. Unlisted property trusts are also available, however there are generally restrictions associated with trading in an unlisted trust.

Learn more about listed property trusts.

Contact Dixon Advisory about investing in property.