Hopefully now you have your goals, mind set and money rules in place, you have seen an expert and had help in getting your numbers together to know your borrowing capacity.
So now comes the fun bit – selecting the property and doing your research around the property purchase. You will have worked out your guide lines from knowing your numbers – are you looking for a cash flow positive property, a renovation project, or something that is an advanced strategy such as a duplex or splitter block or maybe buying off the plan in a highly desired area with potential for fantastic capital gains.
This is also where you try not to be emotional about the purchase i.e. buying the property next door, or your parents old home but in saying that this could be the perfect purchase so long as you know the numbers on it and can separate business from emotion.
Check the numbers against the purchase, stamp duty payable, loan fees, what deposit you need, what is the rental return and the recent sale prices of comparable properties – both so you know your not getting ripped off and if you are doing advance strategy – that the sell price for your property is not over inflated.
So some of the things you need to consider when purchasing is who is going to be the tenant or the end buyer of the property? What do they want? A one bedroom apartment in the city is going to be a different tenant to the 4 bedroom home in the suburbs. What transport is around? Infrastructure to be built – roads, hospitals, university, schools, child care. Is it a cafe society and have restaurants, bars and inner city lifestyle? What is the council doing, local state and the government regarding policy and planning?
You don’t have to inspect the property if you are going to buy, but if it is an existing property that you can access I personally like too. You also need to be diligent – like getting solicitors to read the contract on an off the plan purchase, engage an expert in handling the new building handover to make sure it is built to the specifications or getting a building and pest inspection done if buying a second hand property.
Now working with Blue Wave Property Strategies we help you to build a multi property portfolio. So you will not just be buying the one property…. we will get a portfolio plan in place from the start and you will look to purchase multiple properties all stemming from this initial investment. So this portfolio can be a mix of the types of property to suit your strategy. It can all sound a bit daunting but I can assure you – it is simple if you know how!
There are so many more areas to cover and I could talk for days on this topic but for now……. get cracking and go shopping for assets that appreciate and deliver cash flow to you ready for Christmas!