Are you considering buying your first investment property? While it’s an exciting decision, entering the housing market requires the right mindset, approach, and attitude. And that’s where we can guide you to seek professional advice that may help you make the most from your first-time investment.
While it may seem like an overwhelming experience, there are a few simple tips you can follow to make the journey less stressful without breaking the bank or over-exerting yourself.
Assess your cash flow
By closely assessing your cash flow and seeking the assistance of qualified professionals, you can put yourself in the best financial position to remain in control of your investment property. Cash flows in, in the form of rental payments, and flows out through expenses such as mortgage payments, council and water rates, strata fees, the cost of general repairs, and (possibly) land tax. Without a thorough understanding of the cash flows associated with your first-time investment, your property may quickly become more of a burden than a benefit.
Understand your property goals
Is this first-time investment purely for rental purposes? Do you plan to retire in your second home and use it throughout the year for summer holidays? Are you looking for an inner-city apartment to serve as a passive income? These are some of questions to ask yourself when determining your property goals.
By setting yourself goals and intentions for your investment property it will help you better understand your budget and your long-term plan for that property, as well as the time and effort you’re willing to put towards the investment.
Put location at the forefront
Choosing the right location is a key factor to consider. This requires a forward-thinking mindset. For example, if you invest in an area that is currently booming, that location might experience a bust, resulting in value depreciation and a reduction in the return on your investment. It may be better to choose a location that is within your budget with long-term potential to rise in value. And that’s why it’s so important to understand your property goals and speak to investment and real estate professionals.
Maintain a rational approach
While investing can seem like a largely financial process, property can quickly become an emotional process.
As The Property Tribune explains, ‘Savvy property buyers will always assess what is the most likely market price of a property and will stubbornly stick to the numbers that they have wisely calculated.’
On the other hand, ‘Less experienced property buyers…may start out having an ‘idea’ of what price they are prepared to pay, but then wind up forking out tens, or even hundreds, of thousands of dollars more for it.’
This point reinforces the importance of setting your property goals from the start. By understanding what you want out of your property, you can apply a consistent and rational approach, remain objective and stay in control of your investment.
Choose a property that’s low maintenance
The basic concept of investing in property is founded on the expectation of financial return. So, choosing a low-maintenance property may be a good place to start. The ideal property runs itself and thankfully, in 2022, there are plenty of solutions which make that possible.
The aim is to reduce the time your first-time investment requires. From digital lock systems to outsourcing cleaners and using online platforms to showcase your property, achieving a low-maintenance property has never been easier. Plus, your time is priceless, and an investment property is as much about the initial cost as it is about bringing you financial returns years down the track. When it comes to saving time and effort on major repairs and pest control, it’s a good idea to have a building and pest inspection that you can rely on. With a thorough building and pest inspection report, you can buy property with greater confidence, knowing you’re prepared and informed about your property from the outset.
Trust in professionals
Speaking to a team of experienced professionals is a great place to start when it comes to putting your tips into practice. The process to owning an investment property can be time-consuming and overwhelming. While you can do your best to prepare and research, there are professionals who have spent their working lives in the world of investment property. Whether it’s a quick conversation or an ongoing engagement, speaking to experts with industry insight is always a good way to remain in control of your first-time investment journey.
Ready to buy your first investment property? Then we’re here to help! Thanks to our digital approach and industry expertise, you’re in great hands. Plus, our conveyancing team are ready to help you navigate the process in a simple and straightforward way. You can get started today with a free quote.
This article is provided for general information purposes only. Its content is current at the date of publication. It is not legal advice and is not tailored to meet your individual needs. You should obtain specialist advice based on your specific circumstances before taking any action concerning the matters discussed in this article.