The Old School Property Investment Process
Scouring over pretty pictures of shiny kitchens and bathrooms on realestate.com, trekking out to open inspections, and hoping an investment property would perform based on looks alone… are all activities of the past. The old school property investment process is based on appearances, rather than facts.
The New Property Investment Process
So, what of the new property investment process? Well, if you work with a professional QPIA (Qualified Property Investment Advisor) you will have access to pre-completed online research and demographic comparisons. You will be able to find a property in an area with a low percentage of rental properties (some areas are up to 70% rental properties – meaning 7/10 properties in the area are rentals!).
Your QPIA will also assist you to build a personalised property plan to suit your own personal needs – something that has not been done in the past. Getting the right advice for the right property through the right research is the key to ensuring a positive property investment experience.
Today, successful property investment involves qualified professionals, careful research, and judicious decision making. It wouldn’t be wise to leave such an important investment to chance. So, what steps should you follow to ensure you receive the best investment returns possible?
The 7 Simple Steps to Successful Property Investment
1. Know Your Why
Know your WHY. Why are you investing? Do you want to work less? Build a future for your family? Understand why you want to invest and what you plan to achieve. This will steer you on a path to success throughout your investment and assist your team in setting up the right structures for your long-term strategy.
2. Build Your Team
Investing in property is a huge financial undertaking, and it’s important to make sure you get the right help. Build your investment property team with skilled professionals that are experts in their field to ensure each step of the way is done right.
Your team should at least consist of your accountant, a specialised mortgage broker, a qualified property investment advisor, and the property professionals, including a conveyancer, a quantity surveyor, building inspectors, an insurance broker and a property manager. For more information about each of the essential team members, check out this article. These people will be on your side for the duration of the investment process, and having them in place from the start will allow everything to run as smoothly as possible.
3. Get Your Finances Right
Now that your team is ready to go, it’s time to get real about your finances. Take the time to review your personal budget, and realistically assess how much you’re able to commit weekly for the mortgage and any expenses. Ascertain the size of deposit you’re able to make, or whether you have equity on your family home that you can access instead of the deposit. Use the services of your accountant and mortgage broker, and get pre-approval from a lender.
4. Do the Right Research
The right property isn’t just going to fall in your lap. You can complete this step yourself, but it is recommended that you utilise a qualified property investment advisor. They not only have personal and professional experience in property investment, but they also have access to all the right tools that will ensure you end up with a property that meets your investment needs. From analysing median incomes, employment rates, and future infrastructure in an area, your property investment advisor will ensure you get the best returns on your investment.
5. Complete the Building Inspections
If you are buying house and land package or building brand new, this step will last until after the purchase process. For established properties, engaging a building inspector before purchasing the property will ensure you know what issues you may have to mitigate in the future. For new properties, a building inspector will ensure the builders complete everything as promised, and to the required standard. Any issues found must be solved by the builder at their own expense.
6. Work Through the Purchase Process
This is when your conveyancer comes in to handle the process for you. Though you are able to act on your own when making a purchase, the documentation can be complicated. Many investors prefer to save the time and effort by using the expert conveyancer. Your property investment advisor will also be accessible through the purchase process to assist you.
7. Organise Property Management
Once you own the property and it is up to standard, you will want to be able to sit back and enjoy the benefits from owning an investment property. Some property investors think they will manage their own investment property – however, this is not recommended, for a multitude of reasons.
Using an experience property manager will ensure your property is tenanted, well looked after, and takes any worry off you as the landlord,
How Do I Start?
The biggest take away if you’re starting your property investment journey is to get a great, qualified team on your side. They will support you through and help you understand the process, and ultimately help your investment become a success.
If you’re looking for a property investment advisor, Prospa Property Advisory has a team of QPIAs (Qualified Property Investment Advisors) who are willing to assist you with any queries you might have. Give us a ring on 1300 660 335, or email firstname.lastname@example.org to get in touch!