Are you one of those people who would like to invest in property but don’t know where to start? There are many factors to consider when investing in property, location, budget, etc. To assist you in taking those first steps to unlocking your property investment future, we have compiled a list of some key fundamentals.
(a) Strategy or plan– you must have one! This is generally the single biggest asset you will purchase. It doesn’t matter whether it is your first investment property purchase or you are a seasoned investor – begin with the end in mind!
(b) Choose property that is attractive to both tenants and owner occupiers– any property you purchase should be in really good condition, as new, have good sized bedrooms, adequate toilet numbers, off street secure parking and be positioned away from noise and main roads. Most importantly it must be surrounded by good infrastructure such as transport, employment, shopping and leisure facilities. These tend to be found close to a CBD.
(c) The best property in the best location– some properties make better investments than others. Your goal should be to pay the right price for the right property, not just the lowest price on any property. We see many property investors make the potential mistake of buying in their own area “just to keep an eye on it”. It may not be the best area to have an investment property, both for growth & quality of tenant, and this is potentially why so many people stop at only one investment property.
(d) Buy blue chip– If a property seems too good to be true – it probably is. Cheap properties are usually cheap for a reason – usually as there is a lack of demand in that area and they lack the qualities listed above or there is an over supply in the area. Remember that blue chip will mean different things in different areas – that could mean one bedroom units in one area and 4 bedroom houses in another. I recently heard someone say “Do you want a property investment that is a bargain or one that performs?………..”
(e) It is all about time in the market– Many people try to wait until the market is at a low before buying. The successful long term investors know that timing the market is for speculators, not investors. If you have done your research and can afford to buy and hold on to your asset, now is always the right time to buy.
(f) You don’t have to sell to profit-Selling a property to realise a capital gain will incur costs and tax. By refinancing you can access the profits made on the property (equity) to continue investing in property to achieve your documented goals.
(g) Get a good property manager – A good property manager will ensure you get a reliable tenant who pays market rent. Don’t be afraid to change between 6 month and 12 month terms depending upon the market. Also, you and your property manager must set a rent that is realistic. Overpriced rental properties will generally not get rented, regardless of how long you wait. Remember 52 weeks @$385 per week is better than 48 weeks @ $395 per week!!
(h) Build a team of professional advisors – You can’t do everything yourself. Surround yourself with professionals who are experts in their field – accountant, financier, property manager and where possible ensure that they property investors themselves.
For a Free 1 hour consultation on how we can assist you with your property investment, please call Lynda on (03) 9744 7144 or email firstname.lastname@example.org