You’ve done the research. You’ve attended the webinars, read the books and spoken with local professionals.
However, when the time comes to progress your property investment plans, you run into roadblocks. What can you do?
Don’t worry, you’re far from alone. Under 6% of Australians have an investment property under their belts, despite property being a passion for millions of rural and urban inhabitants alike.
In this article, we’re going to talk you through some of the top tips for getting your foot on the property investment ladder. Read on to find out more.
1) Check Your Finances
Before you move forward, you need to understand your spending power. This doesn’t have to be a full financial plan – you can get it done by simply listing your assets, as well as all of your comings and goings.
From this, you should have a robust idea of how much capital you have to invest or put down as a deposit.
2) Set Your Goals
What do you wat to achieve from your investment? The most common reason for investing in property is to secure your financial future, but everyone has different reasons. Regardless of your motivations, however, you need to set clear goals and have a plan in place.
For example, if you want to retire in 10 years, start with a 10-year plan. Then, break this down into a 5-year plan, a 1-year plan – all the way down until you know what you have to do each week to achieve your goal.
3) Get Pre-Approved for a Loan
There are two ways to do this -with a trusted lender, or with a mortgage broker. If you aren’t certain you’re ready to invest, it’s advisable to go through a broker.
It’s recommended you don’t apply for multiple loans at once. Each time you do, a lender will check your credit record and this can have an overall effect on your credit score.
4) Know Your Risk
How much risk you’re willing to assume will dictate your overall investment strategy.
Get independent advice on this from a financial advisor. They’ll be able to calculate your appetite for risk and help you position yourself accordingly.
5) Budget, Budget, Budget
An investment property is a big financial commitment, and you need to make sure you’ve got the capital to cover it. After checking your finances, set aside a clear amount of money each month to pay the mortgage and keep it in a separate savings account to stop yourself from accidentally dipping into it. Then, you’ll know that any rental income that hits your account won’t be needed to cover property repayments.