Investing in property is a big decision and you need to be sure that you make the right decisions from the outset. Getting started in the property investment game can often be equally daunting and exciting at the same time. This is a fast-moving, high-stakes industry with the potential for you to make a lot of money over time. However, if you manage your portfolio poorly, you could also end up in real financial turmoil.
To ensure that your property investment career gets off to the best start possible you need to ensure that you set yourself up for success from the outset. While there are plenty of risks to investing in property, the fact remains that property continues to be regarded as one of the safest long-term investments you can make. As your portfolio begins to grow, it’s always wise to seek out the help of experienced Melbourne property managers to help you manage your properties more efficiently. With a reputable property manager to lean on, you can be sure that you will get the best return possible on your investments as time goes on.
Let’s take a look at five useful tips to help you to get started in the exciting world of property investment.
Decide on a budget.
The first thing that you need to do as a new property investor is to set a budget and stick to it. Understanding exactly how much you have to invest before you start looking at properties, will help you to stay on track with your search. Viewing properties that are within your budget will ensure that you avoid wasting time going to see properties that you are never really going to buy. With a set budget in place, you will make the search for an investment property much more efficient, allowing you to locate a property sooner rather than later.
Understand the ongoing costs.
When you are setting your budget, it’s important to remember your ongoing costs. Many new property investors often make the mistake of focusing solely on the price of the property and overlook the future costs. This is a big error that can quickly result in your property investment plans falling apart. Costs such as insurance, rates and general repairs should all be considered when you are looking for a property to invest in.
Buy in the right area.
Choosing the right area for your investment property is crucial. If there is not enough demand for the type of property you are buying in the area you are looking at, you will find it difficult to lease the building and get a decent return on your investment. Look for properties in sought-after or growing areas. Residential properties that are near schools, supermarkets, universities and public transport will always be more attractive to renters. When it comes to commercial properties, you will need to ensure that the location is easily accessible, close to tertiary businesses and access to facilities such as parking will need to be considered.
Have the property inspected.
Before committing to any investment property, make sure that you take the time to have the property professionally inspected. While the property might look fine on the surface, there can often be hidden issues such as damp, mould, structural issues or even pest infestations that could be hidden out of sight. Having a professional building inspection carried out will help to give you more peace of mind, knowing that the property you are buying is a sound investment. On the other hand, if there are issues with the property, you can now make an informed decision as to whether or not you want to move forward with the sale. Unforeseen issues that are not too serious can be a great bargaining chip when you are negotiating the final price.
Set realistic goals.
Many new property investors enter the market with wild expectations of the success they will have but it’s important to be realistic about what you are trying to achieve. In most cases, property investment is a long-term investment and it can take time before you start to make a serious profit. During boom periods, it’s typically much easier to make money in the property market, however, in tougher economic times, it can take years to achieve the same level of growth. Be sure to set realistic short and long-term goals so you stay on track moving forward.
Start your property investment career off on the right foot.
If you want to succeed as a property investor, you need to ensure that you take the right approach from the outset. Following the tips outlined above, you can be sure that you will make the right moves to get your property investment career off to the best start possible.