Have you been thinking about investing in residential real estate?
If you are thinking about investing in residential real estate, check out our following tips and take some time out to get investor ready.
Take a reality check
The first thing you need to do is ensure residential property is right for you.
As a wealth creation vehicle, we believe it’s the most statistically safe and responsible investment method available.
Everyone needs a roof over their heads and property in the median price bracket after all; keep in mind that something close to good services and facilities will always be in demand.
It’s a good idea to firstly create a plan and understand the advantages of taking your financial future into your own hands, and how to achieve long-term wealth creation.
Getting yourself prepared mentally is the first step to becoming investor ready.
Don't follow the herd
The human psyche is fascinating.
We tend to follow the crowd because we feel comfortable in the illusion that if everyone else is doing something, then it must be right.
There’s even a term for it – ‘social proof’.
Robert Cialdini, a well-known psychologist and author has written about this phenomenon in his bestselling book Influence: The Psychology of Persuasion, which explains why people will do things that they see other people are doing.
So why is it when a particular property market is overheated, and prices keep getting pushed up, that buyers keep flocking to those markets rather than researching areas where prices are yet to peak?
Smart investors know that good advice and a bit of hard work will ultimately reward them with a better outcome than following the herd.
Take the Darwin market for example.
The smart investors are looking to Northern Territories’ capital because they know the Sydney and Melbourne markets have peaked, thus the rents being achieved in Darwin are high and the cost of buying an investment property there is still relatively low compared to other states.
The challenge is know where to buy and what to look for. If you’ve got time on your hands you could trawl through the property pages and do your own research.
Imagine if you found the perfect investment property that ticked all the boxes, but you missed the opportunity because you didn't have your finances ready.
This scenario plays out time and time again, as it’s the area that takes the most time to get sorted, but people often leave it last on their list of plans.
Becoming investor ready means having your finances in place by being responsible about the amount of money you want to borrow, and having pre-approvals in place.
You can run around and apply for loans from a number of banks and hope you’ll get approved, which could put a red flag on your credit file as they don't differentiate between successful and unsuccessful applications, or you can call in a professional finance broker to do it for you.
Call2View’s investment ready solution
The property cycle will keep on turning, so too will the number of people that say they want to achieve financial freedom but leave it too late to act.
Call2View can assist you with the tools and guidance to get your residential property investment portfolio underway - give us a call today on (08) 8932 8858.
Our friendly staff are always on hand to help. Get in touch.