When you’re looking at property investments for the first time it can be easy to get distracted by all the various things you have to remember and advice you might listen to. Experienced property investors usually have a process they go through for when looking at expanding their property portfolio – they understand all the ways they can minimise their risks upfront and ensure they are getting a long term successful investment. Let’s look at 5 of the risks you can avoid when first starting out.
1. Being Financially Prepared
Being prepared when you’re thinking about property investments means understanding your financial position, knowing how much you can borrow and how much you will be able to pay back, as well as having all relevant documents and pieces of information organised and easily accessible. Don’t leave anything to chance.
2. Having A Strategic Plan
Having a 10 to 15 year plan for your property investments is one of the first critical steps to creating a sustainable property portfolio. A plan with sensible goals and a clear pathway can help you stay on track even during the natural ups and downs on the property market. Getting assistance with you plan from professionals such as Ironfish can also help as they have the years of experience to give you the direction you need.
3. Conduct Thorough Research
Starting out in property investment without having conducted thorough research about the market and specifics such as the best locations to invest in and the types of property that are right for you, is a bit like jumping into a swimming pool without knowing how deep it is or if there’s water there at all. Make sure you understand the basics of the property market, get familiar with the terms and the trends, as well as do in depth research into the location you’re thinking of investing in and the type of property you might want to purchase.
4. Don’t Settle For A Property
Don’t make the mistake of falling in love with an investment property, or, even worse, buying the first property you inspect, or the first off the plan development you look at. Always keep your options open until you find the property that will suit your long term strategy and your budget.
5. Hire A Property Manager
Finally, always hire a property manager to look after your investment. Don’t make the mistake of underestimating the amount of work that is involved in managing such a property on a day to day basis. Always find a professional company that has local knowledge and expertise, as well as a dedicated research team such as Ironfish.