Houses, units, funds or trusts: What is your preferred way of investing in real estate and why?

Model house














OUCH! Cupid’s arrow, right in my soft spot. Ain’t nothing quite like property to get me all steamy.

My first true investment love was property. Oh, when the light finally dawned for me, I was besotted. Since then, it’s been an ongoing, passionate, and very public relationship (my sixth property book is on the way). Thankfully, Mrs DebtMan approves of this affair.

Property must have plenty of land – the scarce resource that drives demand. Houses are fine and units with land can be to. Medium and high-rise developments are no-go zones. And it must be a mainland state capital (sorry, Tasmania).

But investment property is not for everyone. It’s a far more complex and expensive investment to control. Picking badly or stuffing up the debt that goes with it can, literally, send you broke.

It involves monstrous debt, which would stop some people sleeping at night.

If direct investment property scares the daylights out of you – and that’s perfectly reasonable, given the risks – it doesn’t mean you should avoid property.

You can get access to commercial property through the likes of real estate investment trusts (REITs) and managed funds, where my preference would be index funds.

But after watching the “big freeze” on direct property funds in 2008, some of which are still trying to unwind years later, they are not an investment I’d go anywhere near. For those still waiting for their money, it must feel like they’ve had to wait for hell to freeze over and then thaw out again.

Bruce Brammall is the principal adviser with Castellan Financial Consulting ( and author of Debt Man Walking.