Many people treat property investment like a fairytale. You know how it goes… pretty girl marries charming prince, they live in a castle and it’s ‘happily ever after’.
BY JANE SLACK-SMITH
Well, the reality is there’s also a wicked witch (or two) around, who, with a quick wave of her wand, can deliver enough evil to derail the best-laid plans. Interest rate rises, termites, floods, or perhaps even the new neighbours who’ve boarded up the windows and set up a meth lab next door. All of these have the potential to turn the fairytale into a nightmare when you haven’t assessed the risks and put plans in place to minimise them.
The good news is that there are also fairy godmothers out there! Happily ever after can be a reality as long as you follow the rules and don’t leave the well-trodden path.
So what are these mysterious rules you need to obey?
- Do your research and get assistance when you need it.
- Buy where people want to live, i.e. where there’s demand.
- Get the property checked out by professionals.
- Make sure that what you’re buying fits into your long-term plan.
- Accept that there may be a few stepping stones until you get to the castle and live happily ever after.
You don’t need to go it alone; if you know where to look there’ll be several fairy godmothers along the way to help you out – for example, mortgage brokers, pest inspectors, insurance providers, property managers and other property professionals who can help you to make better decisions and also show you how best to protect your investment.
You can have your own fairytale, but just watch out for some of these traps that can litter your path:
- Impulse buying because you get sick of looking.
- Buying ‘toys’ and eroding your cash contribution.
- Keeping up with the Joneses.
- Not doing enough research.
- Not monitoring your portfolio (at least annually) to ensure it’s still working for you.
Your castle awaits, you just have to plot a steady course to get there so that you can live happily ever after. Sorry I can’t help you with the prince (or princess) though… you’re on your own there!
Tell us what you think? Can property investment end ‘happily ever after’? What wicked witches have got in your way?
Jane Slack-Smith is the Founder of Your Property Success, an online property investing education portal committed to affordable education.
One of our properties was flooded up to the window sills in January, insurance didn’t cover floods. This was an expensive lesson for us as we thought we had all our ducks lined up, but we were caught out. Luckily we had a line of credit to tide us over, and our tax return also helped out, but we are still behind the eight ball now.
Just have to smile and get on with it, and wait for the next hurdle……
Comment by Angie — August 23, 2011 @ 12:48 pm