Taking A Holistic Approach To Property Research - Part 1
No matter what budget you’re dealing with, finding your next perfect investment property is a project that requires both patience and planning.
In this piece, we’ll introduce a holistic approach to research analysis and acquisition that you can use to make narrowing down your overall search options significantly simpler. It’s a system you can easily re-use for each individual project and tweak to match your existing overall goals.
Firstly identify your overall goals, your internal motivations, strategies, and desired outcomes. With those background elements in place, we can start looking at leveraging them in the context of a specific investment project.
Our five-step funnel
A simple five-step funnel lies at the heart of our approach. Rather than starting with a particular property and then trying to shoehorn your outcomes and strategy into it, we’ll begin by zooming out and then gradually narrowing our focus.
Let’s step through the layers:
1. State versus state: Kick things off by pitting states against each other to match your specific needs.
2. Local government areas: With a suitable state identified, you now want to start breaking things down by local government areas to identify an attractive candidate.
3. Suburb: You’ve got your LGA, now the search moves on to competing suburbs.
4. Street: Once into a particular suburb, you’re hunting on a street-by-street level.
5. Property: Finally, you’ve drilled down to a particular property to assess the merits of it in detail.
Why go from macro to micro
When you compare our sequence to a less sophisticated traditional search, the advantages become clear. Were you to start with an individual property or street, for example, you’re then going to have to check whether you’re in a suburb set for imminent growth or one that’s a slower burn.
You’ll then need to assess whether the LGA amplifies or detracts from the potential upside of the suburb, and then move on to factor in state-wide considerations. At each stage of your decision-making process, you may encounter an issue that invalidates the property under consideration. You’ll also have to potentially carry out that process a completely unnecessary amount of times.
By going from macro to micro, by contrast, you make sure that your wider criteria are guaranteed to be met, and can save your energy and resources for honing in on the perfect opportunity at an individual property level.
Hopefully, the idea of using this approach has already got you fired up about the possibilities for your next investment property purchase. We’ll be fleshing out the details of both the individual layers of the funnel and further strategy around its use in future articles so stay tuned!