As I meet clients in and around Newcastle, a common question asked by clients is ‘is having property in Super worthwhile and what does it involved’.

To help answer these questions here is an extract from Bina Brown of AFR.

Property investors looking for ways to turbo charge their retirement savings are focusing on do-it-yourself superannuation funds. Borrowing money to buy property has long been a favourite strategy among investors. Factors that make it preferable include tax benefits through negative gearing and the fact you can usually see and touch what you own.

Rules introduced in September 2007 to legitimise listed security warrants mean borrowing is now permitted by a super fund if the borrowing is structured as an instalment warrant.

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That’s Super

The advantage of buying residential property through a self-managed super fund

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Pulling out the crystal ball is always fraught with danger… So I have closed my eyes and here we go: 

ARIES
Australian Shares
The Australian share market still provides a good medium term investment opportunity. Over the past year, companies have taken the opportunity to cut costs and wind back debt levels, which should support profit growth as the economy recovers.

TAURUS
Emerging Markets
Likely to be the key driver of any global economic recovery. It is anticipated that countries like China, India and Indonesia will record strong economic growth in 2010 and beyond.

GEMINI
Developed Markets
Developed economies like the US, Japan and Europe are likely to record positive growth in 2010 after contracting over the past 18 months. To date these countries’ share markets have underperformed developing or emerging markets, and with a return to growth, the company profit outlook should improve and attract investor inflows.

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What time is it?

Knowing what to invest in is difficult at the best of times. There is so much information in the media, that often it seems to be conflicting.

A tool called, ‘The Economic Clock’ has been around for a long while and is based on the assertion that the economies of most developed countries move in a regular pattern known as the ‘boom & bust’ cycle.

The economic clock is a composite of individual economic indicators such as interest rates, employment real estate and the share market. The economic clock depicts the sequence of events in an economic cycle that influence the value of the asset classes.

Each event in the cycle tends to be the result of the proceeding economic condition.

While the clock is not fool proof, it does demonstrate indicators to watch out for.

How has the ‘clock’ played out in real life?

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