How to buy property right 

How to buy property right 

Buying property has definitely got its upsides and its downsides. The skill lies in navigating these in your favour in order to make your property investing most profitable.  The most common words of wisdom heard from those that do well with their investments are; buy with your head, not your heart; and the profit is in the purchase.  This is where most investors and especially those new to property investing, go wrong. Most tend to treat buying an investment property just like buying their home, which translates to an emotional buy. This is where most go about it the wrong way too.  Commonly, we tend to look at agents’ windows, websites and the big property portals for suitable properties to find an investment. Yet, there are other ways to go about it if you want to buy with the added value of either having fast capital gain, scope for improvement, sub-division or even development potential.  Ultimately, when we want to buy any other product at the best price, we look at ways to buy from those that need to sell, how we can get it at a reduced price; buy it at wholesale or direct from the producer. Come to property, most investors look only at the retail end, which in most cases means that they are paying a premium price to begin with.  ‘The biggest profit is made at the point of purchase’, I have been told too many times from successful investors to ignore.  Just like a personal trainer at the gym, or a life coach for your career development, a property investment mentor are available to help you...
What to plan to achieve your financial goals 

What to plan to achieve your financial goals 

One in four Australians have not made a financial plan and two in five have only made vague plans.  According to the Financial Planning Association of Australia survey, the top three dreams for Australians are to have full financial independence, have the lifestyle we dream about and pursue our own hobbies and interests.  Despite this, we also have financial regrets — namely that we have not saved (47 per cent) and invested (27 per cent) as much as we thought we should have. Interestingly, 63 per cent of us have not mapped out our financial future at all or have loose plans. A quarter of us never seek advice from others when making financial decisions.  So, what can you do to make sure you achieve your financial and lifestyle goals? Here are five tips to get you off to a good start:  Write down your list of achievements for the past 12 months.  Many people find goal setting daunting. I suggest you write down all of your achievements for the previous 12 months. For example, receiving a pay rise, laying down new carpet in the bedrooms, going on a long-awaited holiday, teaching your child to play tennis, spending more time with your spouse over coffee/tea with no TV and so on.  Write down every goal whether it be financial, lifestyle and relational because it puts into perspective that you have achieved more than you may initially recall. The positive mindset this creates can then help with setting new goals or tweaking old ones.  Set some financial goals and seek professional advice. Approximately 20 per cent of Australians seek financial...
5 tips for investing 

5 tips for investing 

Many investors fail to get past their initial wish-list. Whether it be fear, timing, limited support or outright procrastination, lots of resolutions remain just that; a wish-list item which never eventuates. Here are some tips. Planning isn’t always easy, and it’s not all that simple either. Lots of thought needs to go into the why, the how and the when; and that’s before investors even get to the what.  A resolution needs to be clear, meaningful, results-driven and achievable if investors are  to have any chance at meeting their goals.  Here are some initial steps for those who are serious about property investing.   FINANCE Financial discipline is critical to the success of real estate investing. Get clarity on your borrowing power, ideal loan structuring and leveraged amount (i.e. the LVR – loan-to-value ratio). The funds you have on hand will help determine how much and when you can borrow. Without this critical step, there is little point planning anything else in the journey yet. Speak to a knowledgeable finance adviser with a proven track record for investment lending because loan setup is critical at the start.   MOTIVATION Ask yourself what your motivation to invest in property is based on. Quantify what it is you wish to achieve through property… is it a better financial future with less reliance on super/pension? Is it a specific passive income per annum? Could it be attaining your first home? Or is it about building wealth? Taking the focus off the number of properties or the value of your portfolio is imperative if an investor is serious about an outcome, not just a goal. The real question...
Are high-end properties the key to real estate wealth? 

Are high-end properties the key to real estate wealth? 

It may surprise many first time investors that purchasing well-located lower-priced properties can deliver higher rates of capital growth than properties located in much more expensive suburbs.  In areas such as Perth and Brisbane, for example, you can still purchase well located properties in suburbs with a median house price of less than $500,000 that can achieve greater annual capital growth rates than properties in suburbs with a median house price of above $1 million.  First time investors should take the lead from the large number of people whose wealth has been based on buying affordable properties in well located areas.  There are literally thousands of wealthy people throughout Australia who at one stage in life bought a very affordable home as their first home and then used this as a stepping stone to create personal wealth over the long term. So how do you buy an affordable property?  Check if there are any upgrades in your affordable areas to local infrastructure such as new schools, shopping centres or transport. New infrastructure can increase the value of properties by making homes in these areas more appealing to buyers. The best areas to buy affordable properties are locations with high population growth rates. You should target affordable properties in these locations with as much land content as possible. Make contact with a number of agents to check what type of properties are most in demand in the local area. This will give you an indication of what type of property will appeal to future buyers if you decide to sell. Check with the local council to find out which suburbs have any...
How to find properties with strong growth potential

How to find properties with strong growth potential

If your goal is to create lasting wealth it is essential to have assets with capital growth potential in your investment portfolio.  You need to buy with a goal of creating capital growth. Focusing on cash flow and a positive cash return is a short-term play. Without growth, you’re not going to be able to create lasting wealth for the long-term. You need to focus on the drivers of capital price appreciation.  Location – This is the main driver of capital growth. There are many things you can change about a property, including its layout, condition, colour scheme, even the number of bedrooms it offers. The one thing that you can never change is your property’s location. A quality location is important. It ensures long-term demand from a rental perspective, and ensures you have a robust buying market if you decide to sell.  Infrastructure – Infrastructure is a major consideration. Infrastructure means any kind of infrastructure – whether it be transport, industry or commerce – that will benefit local residents. This could be anything from a new train line or expanded freeway, to commercial construction that adds employment opportunities to the region.  Condition – When deciding which property to invest in, you can buy a brand new property or an established property. You may decide to renovate to add value and build equity, or you could buy a new property to access the depreciation and tax benefits. Either strategy can offer price appreciation potential.   Balance – Try and strike a balance between yield and capital growth. Make your wealth creation strategy as passive as possible. This leans towards buying new properties that are low maintenance...
4 ways landlords can benefit from tenants with pets

4 ways landlords can benefit from tenants with pets

With floor stains, scratch marks and garden damage a potential outcome, why should you allow pets onto your property?  The decision to allow pets into your investment property is important – and when you start thinking about dog hair, possible claw marks and minor damage to your half-a-million-dollar investment, it’s tempting to say no, and this is what the majority of Australian investors do. The math is pretty straightforward: if you exclude every potential tenant who owns a pet, you’re eliminating a huge number of households from your rental pool – 60%, according to the Australian Companion Animal Council. And yet, a survey by the Real Estate Institute of Australia showed that 40% of investors don’t allow pets, and 28% weren’t sure if they would or not. Talk about finding a niche market of renters! If all those renters with pets – and there are millions of them – are hunting for the rare property that will allow their furry friends to stay, doesn’t that make pet-friendly homes a little more sought-after? Yes it does, and in fact realestate.com.au says that renters are often willing to pay a little extra to cover their pets staying too. How can you benefit from allowing pets? Higher rental returns. Pet owners can be willing to pay a little more if it means the difference between keeping their pet or not. Larger pool of renters. Having a property that’s desirable to a significantly larger pool of households – and in fact, one that sets it apart from most of the other listings on the market – can significantly reduce downtime between tenants. Longer tenancies. The...
How to buy property the right way

How to buy property the right way

Buying property has definitely got its upsides and its downsides. The skill lies in navigating these in your favour in order to make your property investing most profitable.  The most common words of wisdom heard from those that do well with their investments are; buy with your head, not your heart; and the profit is in the purchase.  This is where most investors and especially those new to property investing, go wrong. Most tend to treat buying an investment property just like buying their home, which translates to an emotional buy. This is where most go about it the wrong way too.  Commonly, we tend to look at agents’ windows, websites and the big property portals for suitable properties to find an investment. Yet, there are other ways to go about it if you want to buy with the added value of either having fast capital gain, scope for improvement, sub-division or even development potential.  Ultimately, when we want to buy any other product at the best price, we look at ways to buy from those that need to sell, how we can get it at a reduced price; buy it at wholesale or direct from the producer. Come to property, most investors look only at the retail end, which in most cases means that they are paying a premium price to begin with.  ‘The biggest profit is made at the point of purchase’, I have been told too many times from successful investors to ignore.  Just like a personal trainer at the gym, or a life coach for your career development, a property investment mentor are available to help you to understand...
5 ways to achieve your financial goals

5 ways to achieve your financial goals

One in four Australians have not made a financial plan, and two in five have only made vague plans.  According to the Financial Planning Association of Australia survey, the top three dreams for Australians are to have full financial independence, have the lifestyle we dream about and pursue our own hobbies and interests.  Despite this, we also have financial regrets — namely that we have not saved (47 per cent) and invested (27 per cent) as much as we thought we should have. Interestingly, 63 per cent of us have not mapped out our financial future at all or have loose plans. A quarter of us never seek advice from others when making financial decisions.  So, what can you do to make sure you achieve your financial and lifestyle goals? Here are five tips to get you off to a good start:  1. Write down your list of achievements for the past 12 months.  Many people find goal setting daunting. I suggest you write down all of your achievements for the previous 12 months. For example, receiving a pay rise, laying down new carpet in the bedrooms, going on a long-awaited holiday, teaching your child to play tennis, spending more time with your spouse over coffee/tea with no TV and so on.  Write down every goal whether it be financial, lifestyle and relational because it puts into perspective that you have achieved more than you may initially recall. The positive mindset this creates can then help with setting new goals or tweaking old ones.  2.  Set some financial goals and seek professional advice. Approximately 20 per cent of Australians...
5 tips for investing

5 tips for investing

Many investors fail to get past their initial wish-list. Whether it be fear, timing, limited support or outright procrastination, lots of resolutions remain just that; a wish-list item which never eventuates.  Planning isn’t always easy, and it’s not all that simple either. Lots of thought needs to go into the why, the how and the when; and that’s before investors even get to the what.  A resolution needs to be clear, meaningful, results-driven and achievable if investors are  to have any chance at meeting their goals.  Here are some initial steps for those who are serious about property investing.   FINANCE — financial discipline is critical to the success of real estate investing. Get clarity on your borrowing power, ideal loan structuring and leveraged amount (i.e. the LVR – loan-to-value ratio). The funds you have on hand will help determine how much and when you can borrow. Without this critical step, there is little point planning anything else in the journey yet. Speak to a knowledgeable finance adviser with a proven track record for investment lending because loan setup is critical at the start.   MOTIVATION – Ask yourself what your motivation to invest in property is based on. Quantify what it is you wish to achieve through property… is it a better financial future with less reliance on super/pension? Is it a specific passive income per annum? Could it be attaining your first home? Or is it about building wealth? Taking the focus off the number of properties or the value of your portfolio is imperative if an investor is serious about an outcome, not just a goal. The real question becomes –...
How to find properties with strong growth potential 

How to find properties with strong growth potential 

If your goal is to create lasting wealth it is essential to have assets with capital growth potential in your investment portfolio.  You need to buy with a goal of creating capital growth. Focusing on cash flow and a positive cash return is a short-term play. Without growth, you’re not going to be able to create lasting wealth for the long-term. You need to focus on the drivers of capital price appreciation. Location – This is the main driver of capital growth. There are many things you can change about a property, including its layout, condition, colour scheme, even the number of bedrooms it offers. The one thing that you can never change is your property’s location. A quality location is important. It ensures long-term demand from a rental perspective, and ensures you have a robust buying market if you decide to sell.  Infrastructure – Infrastructure is a major consideration. Infrastructure means any kind of infrastructure – whether it be transport, industry or commerce – that will benefit local residents. This could be anything from a new train line or expanded freeway, to commercial construction that adds employment opportunities to the region.  Condition – When deciding which property to invest in, you can buy a brand new property or an established property. You may decide to renovate to add value and build equity, or you could buy a new property to access the depreciation and tax benefits. Either strategy can offer price appreciation potential.   Balance – Try and strike a balance between yield and capital growth. Make your wealth creation strategy as passive as possible. This leans towards buying new properties that are low maintenance...
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