Ready to get started with property investment? Fantastic. Purchasing an investment property is a reliable way to earn passive income and build your wealth long-term.
If you’re new to property investment, the following six tips are an excellent starting point. Let’s get right into it.
1. Set a Realistic Budget
Before you purchase an investment property, it is vital to have a solid understanding of your financial position. Set a realistic budget, so you end up with a property you can afford long-term.
2. Factor in Ongoing costs
When creating your budget, do not forget on-going costs. Consider things like rates, insurance, and maintenance. Plus, keep in mind there will be periods in which you do not have tenants paying rent – these will impact your bottom line.
3. Explore Growth Areas
Investment properties with the greatest potential are situated in areas with a strong demand for rentals. Look for suburbs with good transport connections and living facilities (such as schools, shops, and healthcare).
4. Invest in a Building Inspection
Before you sign the contract, you must invest in a professional building inspection. This will help you steer clear of expensive, large-scale repairs further down the track.
5. Understand Your Investment Goals
For property invest to be successful, you need to set realistic goals. Are you looking for shorter term capital growth, or wanting to hold onto the property for a decade or more? What outcomes are you hoping to achieve by purchasing a property?
6. Trust Your Head (Not Your Heart)
It’s key to remember that this is an investment property – you will not be living in it. Don’t get caught up in your emotions. Never purchase a property because you personally like one particular feature. Always go for the most functional, practical option.
That’s Just the Tip of the Iceberg
There truly is so much to consider when purchasing your first investment property. Your budget, goals, and other unique circumstances will impact the type of home you should buy.
Please note, this article is not tailored to individual situations. Always seek professional advice from a financial expert before making any decisions.