The 6 Most Important Life Lessons of a Property Investor
You’ve read the books, magazines and reports. You’ve been religiously checking realestate.com.au for properties. You’ve been in contact with numerous builders, realestate agents, buyers agents and developers, but yet when the push comes to shove, you stop!
You’re not alone. In fact less than 6% of Australians, or roughly 1.3 million people own an investment property, even though property is a national past time. It’s not surprising that a lot of people get overwhelmed by the process and quit before they even begin. The truth is, it doesn’t have to be like this. Property Investing is relatively straightforward. We would like to share some of the most valuable investment lessons we’ve learned over the past 5 years which has helped not only make our investment journey smoother but as well as so many of our valued clients.
HAVE A PLAN
Strategic investors have a plan. They know where they are heading and follow a proven system. They make educated investment decisions based on research and buy in areas that will produce long term capital growth as well as above average rental yield.
TAKE A LONG TERM PERSPECTIVE
As you may or may not have known. The property market moves in cycles and in every decade there are a few years of flat or falling property prices, however well located real estate has increased in value by an average of over 8 percent per annum over the long term. Imagine if you could buy the house your parents bought at the price they paid thirty or forty years ago. The question is: how many properties would you have bought then knowing what those properties are worth today?
TREAT YOUR PROPERTY INVESTMENT LIKE A BUSINESS
Like in any business, you need to have the right team of professionals to assist you. You become a successful investor by aligning yourself with the correct advisors such as: finance brokers, buyers agents, mortgage brokers, conveyancers and accountants.
THERE IS NOT ONE PROPERTY MARKET
While many people generalise about ‘the market’ there are many submarkets around Australia. Each state is at a different stage of its property cycle and within each state the markets are segmented by geography, price points and type of property.
THE CROWD IS USUALLY WRONG
It is human nature to want to follow the crowd. Warren Buffet says it best “be fearful when others are greedy, and be greedy when others are fearful”. Most people want to follow the crowd and buy in areas where the masses are buying and in some cases this may be at the top of the cycle. However, when all the doom and gloom sets in, people tend to run. This is when sophisticated investors see opportunity and prepare themselves for the next upturn. Remember that each property boom sets up for the next downturn, just as each downturn sets the scene for the next upturn.
USE DEBT DEBT AS A TOOL
While many people worry about debt, smart investors use ‘good debt’ and leverage to build their asset base. Using ‘OPM’ (other peoples money) AKA: the bank is a fantastic strategy to grow your wealth, providing your current financial situation allows you to do so.
With so many mixed messages out there about what type of property makes a good investment, it is sometimes hard to know who to listen to. E-Fishient Property Solutions prides it’s self on the level of service it brings to its valued clients. Wether you are a First Home Buyer, First Time Investor or a Seasoned One, we would love to hear from you.
Remember that you can redeem your COMPLIMENTARY 2 hour strategy session in which we will define and work out what your goals and needs are and then create a road map that will allow you to fulfil them.
Call us today on 1300 148 417 and until we speak with you then, we wish you all the success in the world.