7 Things Successful Property Investors Do
If you’re new to property investing, what are the things you should do to make investing in property a success? Follow these simple steps and it could save you a bit of time and stress of getting into an investment property.
Understand your purpose for investing
Have a clear idea of why you want to invest. Is it for cashflow, capital growth or both? Understanding this can help you with your suburb and property selection. Be realistic with your purpose. Property investing is a long term game so be prepared to sit down and consider what you would like to achieve from investing. The clearer the purpose, the easier it will be for step 2.
Develop criteria for your investment
Putting together simple criteria can help guide you when choosing where and what to invest in. It allows you to narrow down your search and will get you looking at properties you might actually want to invest in. Criteria could include the number of schools in an area, how many bedrooms in a home, distance to shops, minimum rental return, government spending, vacancy rates and more. But be aware to keep your criteria realistic and achievable otherwise you may not end up investing in anything!
Get your finances in order
It may sound obvious but get your finances in order. Not just pre-approval for a loan but also check in with your budget. Lenders will use tools to determine your capacity to borrow, but only you will have an idea of the reality of your money. Look to have a buffer in your finances so you don’t stress when things don’t go to plan. Once you have this sorted, then you will know the price brackets you need to stay within.
Sometimes the best deals you make are the ones that you don’t make
Don’t just do research, understand it
It’s quite easy these days to gather information for property. There are plenty of resources to give you figures on things like capital growth, rental returns, recent sales, government spending and so on. While all these numbers can paint a story, it is equally as important to understand why and how these numbers came about. Questions to ask might be why capital growth is low while rental returns are high as an example. How is the local government spending the dollars in funds they have? Getting to understand the research will help put things into perspective for better decisions.
Seek out professional advice
As you go on the journey of investing, you will no doubt here a lot of advice and opinion. Take on the advice from people who are professionals in their field and those who are licensed to do so. Seek out second opinions and ask your own questions as part of your due diligence. Some professionals may specialize in a particular field or area so keep that in mind also.
Action items quickly
One way to build a healthy relationship with the people you work with, agents, brokers and so on, is to be prompt with action items. When you’re in the process of buying an investment property, actioning paperwork, supplying documents, answering emails makes you easier to deal with and reliable. Agents and sellers appreciate this and may bring benefits to your buying process.
Be prepared to say No
One of the most important things a property investor can do is to say no. Be prepared to walk away from a deal if it doesn’t meet your criteria, doesn’t feel right or if it doesn’t fit your purpose. As they say, sometimes the best deals you make are the ones that you don’t make.