Top mistakes made by novice buyers
Approaching the Australian property market in the current climate could be a brilliant way to begin a successful portfolio and start working towards wealth generation for the future. It's an incredibly good way to gain a second income and can be lucrative, especially if you take the time to research the local market and make educated, informed decisions when approaching a sale.
Part of this education is learning about the major pitfalls that many first-time buyers fall for. Once you've secured your investment home loan and are ready to start looking into the market, here are some things to keep in mind before committing to any slice of real estate.
Not doing enough market research
This is one of the main pitfalls that first time buyers in general skip. Regardless of whether you're looking for an investment property or your first family home, neglecting to do sufficient research into the local area has the potential to come back and hurt you.
Without knowing about the recent market movements - as well as looking into future projections - how are you to know if the property you're looking into is profitable? Or whether the local region is set to flourish or perish in the coming years?
The internet puts a wide range of data at your fingertips, allowing buyers to do their own digging and make informed decisions. Things like future infrastructure developments, median house prices, median rental yields, projected value growth and historic dips in worth are all things to take into consideration when looking to purchase property.
Waiting for the 'perfect time' to buy
While there are certain circumstances that can constitute a great time to purchase, the chances of these conditions aligning perfectly is slim. Therefore, after doing research, it's a good idea to take the plunge and secure properties that have a decent chance of growth in the future.
After all, you don't want to spend all your time waiting only to miss out on buying a profitable property entirely. There are always things that can be done to help increase the profitability of a property after you buy.
Not adequately looking after your investments
Taking on this responsibility is exactly like accepting a second job. As the owner of an investment property, you'll be expected to take care of the home, regardless of whether there are tenants or not. For example, as a landlord it's your task to ensure everything runs smoothly for those living in the home. They'll be able to call you with problems and it's up to you to take care of these as soon as possible.
Between tenants, it's essential to take care of the home's exterior. Mowing the lawns and maintaining the garden regularly will become a bi-weekly chore in order to keep the property as attractive and appealing as possible.
If you're unable or unwilling to do this, there are professionals called property managers who can assume these roles for you. They will assume an acting landlord position, liaising between tenants and you while taking care of any problems that arise from the renter's end.
Not seeking professional advice before committing
Naturally, it's a great idea to get in contact with a real estate professional before pursuing any property investment. Gaining their expert insight into the local market - as well as their insider knowledge about market movements - will be invaluable when it comes to portfolio success in the near future.
These are just some basic tips to keep in mind when considering property investment. Patience and a willingness to research are two of the main traits of successful property investors and taking a leaf out of their book will work in your favour.
Image credit: Crystal