7 Rules for Investing in Property
You see some people buy a property each time around the board and reach a point where yesterdays properties help pay for the one that you bought today. In fact a collection of 30, 40, 50 properties with the entire portfolio self funded is not uncommon.
So how do you start out? Well that’s a bit like the old question, “how do you eat an elephant?” The answer is of course one mouthful at a time. The same applies to property.
1. Start with research
Talk to the right bank or finance broker to know your borrowing options. You are far more attractive to a seller if you are able to make an offer to purchase that is not subject to finance so talk to your lender about becoming pre-approved.
3. Find an agent that you can trust to always tell you the truth
An agent that understands property investing is a huge advantage.
4. Property selection
Buy the right property rather than what looks like the biggest bargain. Remember if it looks like a bargain it is probably because no one wants to buy it. The same may well happen when you want to sell it.
5. Tax benefits
Understand how the wording of the contract of sale may well set up the tax benefits (depreciation and negative gearing) of your purchase for decades to come.
6. Getting YOU right
Get yourself emotionally ready to make the decision when the right opportunity knocks. Too many buyers get overwhelmed with nerves at the crucial moment. This causes them to make offers that they know at a subconscious level will never be accepted. This keeps them safe, but they never get to enjoy the financial security that property investment presents to those that own the monopoly board.
7. Looking after your investment
Your accountant and your property manager are your greatest ally in this venture. Select them very carefully. They both need to be knowledgeable and accessible. They need to bring their own contribution to the partnership. After all this is not a one year plan. It is a choice that you will live with for decades and is capable of providing great peace of mind.
Property investment is not for everyone. However for those suited it provides immense emotional and financial security. More than that, it gives you a passion and an interest that may endure your entire life, and maybe for the lives of generations to come.