If you’re interested in making your foray into the real estate investment market, it’s essential to ensure you are prepared. Buying your first property can prove daunting, but there are lots of ways in which you can get off on the right foot.
From taking a property investment course to networking with those experienced in the industry, find seven helpful strategies to take before entering the market below.
Take a Property Investment Course
Taking a property investment course is an excellent step for first-time property investors. A course will enable you to acquire the basic knowledge, skills, and resources needed to succeed within the industry.
You will have the chance to learn from experts in the field and study alongside like-minded individuals who will also be able to offer their advice.
A property investment course will cover topics such as how to find the best suburb, how to negotiate the best price, and how to buy interstate. By learning from expert property investment consultants, you’ll gain the confidence and skills required to get started.
Get Your Finances in Order
How Many Months Can You Cover?
Undoubtedly the most critical step to take to prepare for the real estate investment market is getting your finances in order. Ask yourself: how many months can you cover your outgoings without tenants there to pay rent and, in turn, fund the mortgage?
Start an Emergency Savings Fund
It would be best if you also started an emergency savings pot. There are hidden costs that many investors forget about from building inspection, management charges for leasehold properties, and conveyancing fees.
You will need to make sure that you have an emergency fund to fall back on in unforeseen circumstances such as repairs or pest control.
Save for a Deposit
If you have a steady income and a history of long-term employment, you should not have an issue applying for a home loan. You will need to save for a deposit of approximately 20% of the property’s price.
If that’s not possible, consider getting yourself a guarantor – this can be a family member, friend, or acquaintance. It’s also important to get pre-approval from a lender or mortgage broker to prove that they are willing to lend you a certain amount of money.
Get to Know the Market
Before making your foray into the world of real estate, it’s important to garner a greater understanding of the market. For instance, you need to stay updated with the latest trends, mortgage rates, and consumer spending habits. This will help to inform your decision of what kind of property and location to invest in.
Decide What You’re Looking to Achieve
Set your goals before venturing out in search of your first investment. Are you looking to invest in a commercial or residential property? Do you plan to rent out a home or apartment?
Renting out properties or renovation projects is a longer game so make sure to have your long-term goals in mind before making a move.
Research the Local Area
Once you have an idea of where you would like to purchase a property, make sure to conduct thorough research into its proximity to local transport, shops, and schools. If you want to invest in a holiday home, is it within walking distance of popular attractions?
Being aware of the local demographic, housing prices, and future property developments will help inform your decision on when and where to invest.
Use Your Imagination
When investing in real estate, the goal is to make a profit. When looking at properties, try to look beyond their current state as you can build property value through minor upgrades, renovations, and additions.
Build A Reliable Network
No matter how experienced you are, building a support network around you is essential. You may choose to surround yourself with a mentor, accountant, solicitor, depreciation expert, and even a business partner.
You can meet fellow property investors on property investment courses, art auctions, or through online forums and blogs. In the digital world, it’s never been easier to connect through social media, Linked In, and Zoom.
Most property investors will be keen to have a chat about their successes and failures which will prove helpful to you on your journey.
By implementing the above strategies in advance, you’ll feel prepared to enter the real estate investment market. The industry can feel intimidating at first as there is a lot of information to take in, but speaking to experienced investors will give you the tools and confidence to get started.