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Private Mortgage Investments Outperform Traditional Property Rental Investments, Says Franklin Partners Mortgages

A detailed review of the main advantages that drive investors to move their portfolios from property rentals to direct mortgage investments.

NoosaVille, Australia, April 05, 2012 --( The Australian-based mortgage company, Franklin Partners Mortgages, has recently claimed that their mortgage investments pay higher yields than property investments, and based its claim upon a number of financial analysis and key indicators, one of which was the most recent study published by the Money Investor magazine.

The study included a list of 601 hot suburbs for property investors in Australia, out of which only 47 suburbs offer rental yields of over 6% p.a., and only 8 suburbs offer 7-8.7%.

“The numbers show that the typical property investor’s gross yields would rarely go over 7%, while on the other hand, when investing in a private mortgage, yields start from 8%, and up to 12% p.a.,” said Gary FitzGerald, Senior Partner in the Australian mortgage investment firm, Franklin Partners Mortgages.

“This study is a new proof of the advantages of private mortgage investments, compared to the traditional property investments,” he added.

Another important factor in the comparison is the capital needed for each, so while owning a property in one of the hot suburbs yielding over 6% would cost $200,000- $450,000, investing in private mortgages can start with as low as $50,000.

“Owning a property investment requires a considerable amount of capital, and comes with other associated costs such as maintenance, taxes, etc. not to mention the time and effort that needs to be spent in managing it, which is why it’s becoming a less favorable form of investment for busy or inexperienced investors,” Gary noted.

“For example the median cost of house in the hotspot of Brisbane Units, Queensland is $430,000, and the median gross yield from rental is 6.5%, while the median cost of a private mortgage investment is around $95,000, with net yields starting at 8% p.a.

“Additionally, private mortgages does not require much capital, and comes at a face value, with no hidden fees, interest paid in advance, and requiring no management at all,” he added

At the Franklin Partners Mortgages firm, Mr. FitzGerald said that their business aim is primarily to create awareness, educate and then provide local investors with alternative investment information about mortgage investments hitherto unknown in Australia.

The mortgage investment specialist, who focuses his attention on a client base made up of self-funded retirees and sophisticated investors, further pointed out that a direct mortgage investment, with capital protection, can easily return an investor in excess of 10 per cent per annum with interest paid in advance.

With its fully managed direct mortgage investment services, the Franklin Partners Mortgages Firm prides itself in offering clients a higher, safer, less volatile, and more hands on approach to “control returns” than property.

When asked about the safety of investing in private mortgages, Gary FitzGerald said that, beside the fact that all mortgages are backed by sworn valuations, it is the mortgage buyer who is in control so they choose a loan they are happy with, the client’s capital is protected, because Franklin Partners “will buy back the loan if it defaults.”

“We will buy back any mortgage that defaults, and we can do so because we are backed by a UK firm with $250,000,000 performance guarantee bond,” he reiterated.
Contact Information
Franklin Partners Mortgages
Gary J. Fitzgerald
+61 439 810 652

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