For those just starting out, property investment can be extremely overwhelming having to navigate through a myriad of information. But it doesn’t need to be so hard – here are the first 4 steps any new property investor should take.
For new investors wanting to dip their toe into the property investment pool, it’s difficult to know where to start.
An internet search is most common but, given the endless amount of information, it can be near impossible to separate the wheat from the chaff to determine what’s credible, particularly for novice investors.
However, to ensure you start your property investment journey in the right direction, make sure to follow the steps we mentioned below.
4 Steps to Use When aiming to embark on a Property Investment business
- 1 4 Steps to Use When aiming to embark on a Property Investment business
1. Determine your household budget
If you don’t know how much discretionary income you have then it’s difficult to get started. Figure out your monthly household income and expenses and determine how much you’re comfortable allocating each month to repay an investment loan.
Even if you have little discretionary income, you can target properties with minimal or no holding costs (such as villas), which allow investors to get on the property investment ladder.
2. Create a plan with a property investment strategist
A property investment strategist will be able to take an independent look at your situation to determine the best way forward. A strategist can create a property investment plan to map out your long-term goals and how best to reach these depending on your risk profile, financial capacity and life circumstances.
3. Correctly structure your finances with an investment-savvy mortgage broker
As an investor, it’s crucial to engage a finance broker who is a specialist in investment loans. Unlike a bank or a normal mortgage broker, an investment-savvy broker will be able to structure your loans and finances appropriately, taking into consideration your current needs, as well as what will work for you in the future.
4. Find the best investment properties with a buyer’s agent
Property investment is a bit like cooking, anyone can do it but not everyone can do it well. Not all properties provide the same rates of return, not even those within a single capital city, suburb or street, so it’s important to acquire only the best properties to reach your investment goals sooner. Engage a good buyer’s agent who will have an in-depth understanding of the market and be able to identify, inspect and negotiate the purchase of a high-performing property for you.
Buying your first investment property doesn’t have to be a hard, stressful or time-consuming process. The key is to engage professional help along the way who can provide you with the right advice and support.
As you would engage a lawyer if you needed legal advice or a doctor if you needed medical advice, it’s wise to engage credible advisors for your property investment advice.
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Damian Collins is the founder and managing director of property investment consultancy Momentum Wealth. Offering market leading research and advice on the Australian property market, the company helps clients accelerate their wealth through property investment by assisting them in the strategic planning, financing, acquisition, management, and development of their commercial and residential investment properties. Damian has completed a Bachelor of Business at RMIT University and a Graduate Diploma in Property at Curtin University. Damian is a board member of the Property Investment Professionals of Australia (PIPA) and is the Deputy President of the Real Estate Institute of Western Australia (REIWA).