As with any financial investment, it’s advisable to start your property search with careful planning.
Here are some basic tips to help you get started:
1. Think long term
- Don’t try to pick the bottom of the real estate market
- In terms of borrowing money, being comfortable is crucial
- Plan for potential rate increases
- Have some extra cash to deal with tenant vacancies and extra expenses
- Set clear financial goals
- Have an exit strategy
2. Specialise
Choose the one type of real estate asset and become an ‘expert’ in that particular type of investment.Don’t go back and forth between different types of property (renovating, developing, holiday homes etc.) By specialising in the one type of property you avoid making costly mistakes that are made during the ‘learning curve’. In addition to this you become more and more accomplished in your chosen area of expertise with each new transaction.
3. Become an expert in your suburb or area
Gain an understanding of property values by going to auctions and open for inspections, find out average rental yields from real estate agents and take into consideration any Council plans for upgrades to services or improvements in infrastructure. Get this right and the difference to your return on investment could be significant.
4. Seek professional advice
As with any major financial commitment, it’s best to consider your individual situation and seek professional advice.
You should cover off on the following:
- Potential tax implications
- Capital growth of the investment
- Understand the benefits of negative and/or positive gearing
- General vacancy rates in the area you are purchasing
- The right investment home loan
The right mortgage structure can save you thousands of dollars so it’s worth learning to look for the right components.
Home loan help is a phone call away. A bank manager or mortgage broker can assist you with your home loan search. New products surface daily in the fast-paced mortgage industry. Even the most experienced mortgage experts must spend time understanding your individual situation and considering all the different finance products available before making a recommendation to you.
For more information about home loans, to make an appointment with a mortgage broker or to compare home loan rates and offers please visit the ratesonline.com.au web site.
Related posts:
Recent Comments