5-point checklist for first-time investors
While every property investor has their own unique goals, there are certain areas that every investor should look into before choosing a property to purchase.
With markets running hot across the country, now is an exciting time to be investing in property.
But if this happens to be your first time purchasing a property, you probably have a hundred questions.
While every property investor has their own unique goals, there are certain areas that every investor should look into before choosing a property to purchase.
I have put together a handy checklist, which any smart investor should go through. As a property investor with more than 17 years’ experience in the industry, I am sure this information will be useful to investors who are beginning their journey.
Assess your finances
It’s important to dream big, but always be realistic, especially when it comes to your available finances.
Ask yourself the following questions: How much debt do you have? How much are you planning to spend? Do you need to borrow? If so, how much?
The important thing is you have the money not only to buy property, but you’re still able to set aside funds for cash flow.
Your money will also go to the deposit, stamp duty, legal fees, and, just in case, a buffer. To be clear on your borrowing capacity, speak to a mortgage broker or your bank.
Research
Put together a serious and thorough plan. Before committing to an investment, do all the research you need.
You’re already on track by reading this article.
There are plenty more sources available online as well as books focused on property investment, including my book Rented!
You can also get straight to the source by consulting with an accountant, a financial planner, a builder, a mortgage broker, and a property manager, to name a few.
Don’t waste time
When it comes to investing in property, it’s not about the market being active, but more about your preparedness.
Don’t be too busy finding the “perfect property,” because it simply does not exist. Focus on equipping yourself with enough knowledge along with a back up plan.
Speak to the professionals
Owning a property investment is a tough job requiring a sound mind and the ability to make rational choices.
Remaining impartial when it comes to decision-making is crucial, especially when you have to collaborate with one or more partners.
It’s important to get expert advice from professionals like property managers to guide you through it, and I recommend enlisting these experts as early in the process as possible.
Stay positive
Finally, expect the worst and hope for the best. There are a number of things that can go wrong, just as there are many that can go right.
Ensure your finances are not stretched and that you have a buffer in case interest rates rise. Prepare for some occasions when there’s a vacancy throughout your tenancy and set aside money for renovations and unexpected, urgent maintenance.
Successful investments are not accomplished in one day, and you should expect ups and downs in your property investment journey.
Remember to invest for the long term and always to continue doing your research.
