Thinking of property investment Australia? Want to make investing in an Australian property profitable for you and your business? Well, there are few common investing in property mistakes you should avoid. Read on to find additional details on this.
When it comes to matters property investment, many first time investors are likely to jump into it. This they’ll probably do without paying close attention to the process involved. This is more so true if they buy into capital gains they’ll likely get from their investment. The problem with this approach is that they are putting themselves in a position to fail. If you would like to get past your first investment, it is important you develop an investment strategy. This’ll help you avoid common mistakes associated with property investment.
Still on mistakes, below you’ll find common mistakes property investors make when investing. Furthermore, we’ll share tips on how you can best deal with these mistakes. Take this information to heart when making your investment decisions and you’ll win big.
Below is a list of mistakes that we’ll cover in this property investment Australia post;
- Buying With Your Heart
- Poor Cash Flow Management
- Making The Wrong Purchase
- Failing To Plan
- Not Doing Proper Research
Buying With Your Heart
When it comes to property investment Australia, many investors tend to buy with their heart. In fact, many believe that statistically, 90% of your purchasing decision is emotion based. The other 10% as you guessed it is logic. So what’s the problem with buying a property or making a purchasing decision with your heart?
Well, buying a property with your emotions will cloud up your judgement. When this happens, you’ll likely over-capitalise on your property investment Australia. Furthermore, you won’t negotiate the best possible property prices for you. This will put you in a bad place if you are looking for a great return.
So what’s the better alternative? Well, making your decisions based on analytical research. When thinking of making a purchase, answer the following questions;
- Will it offer you your projected returns and gains?
- Is it located in a location that’ll attract the type of tenants you want?
- Can it sustain property prices in the long term?
By doing so, you’ll be looking at the subject of real estate investment analytically. Despite only listing three, it’s good to note there are other questions you should ask yourself. By doing so you’ll be positioning yourself to fully benefit financial wise from your investment.
Poor Cash Flow Management
If you are new to property investment Australia, you are likely to fall into this category. What category am I talking about? Well, property investors who have poor cash flow management. One way of ensuring you don’t have poor cash flow management is seeking services of an expert. Consider getting a professional accountant to help with the finances. They can even handle your interactions with real estate agent just to make sure everything is okay.
This, however, doesn’t mean you should turn an eye on everything money management. Make it your responsibility to know all the costs involved in property investment Australia. This will give you an idea of what you are getting into financially.
While still on the subject of poor cash flow management, make sure you can afford the property you want to buy. Yes, it might sound simple but many fail to factor this in leading to poor cash flow management. To best determine this, focus on how much income will come in as a result of your investment. In particular, focus on whether it’ll be able to cover for your outgoings.
Making The Wrong Purchase
Making the wrong property purchase is arguably one of the biggest investment mistakes of all. It is important you choose the right property before spending your money. With many first time investors, you’ll find that they won’t factor in location when making an investment decision. Those that do consider location end up not giving it too much attention. This mistake usually results in them investing in areas that reduce the chances of getting a good return.
When thinking of making a purchase as a first-time investor, think location. In particular, you want to make sure that you go for the right investment location. Settle with a location where buyers or renters are happy to spend their money to come and stay. Properties in such locations are known as investment grade property. This type of property continues to remain in strong demand by buyers and tenants alike even after some years.
Failing To Plan
Failing to have an appropriate plan is another common mistake in property investment Australia. In case you are still in doubt on the benefits or importance of planning, just pay attention to who has one. Many successful property investors ensure that they have a plan before commencing on any project. This way, they are able to bring the future into the present time. If they find something wrong they work on fixing it right away.
Being able to create wealth from property investment Australia requires you have a plan in place. This plan should have clear goals set up. Of importance as well as having a clear picture of where you want to end up and how your plan best suits it. When making a property cycle investment, you should focus on both long and short term goals. Furthermore, ensure that your investment strategy is in line with your decisions.
Not Doing Proper Research
Failing to do proper research is another common mistake with property investment Australia. That said doing research helps better understand real estate investment. Furthermore, it helps you to get a better grip on what’s involved in real estate. I know what many of you are probably thinking about, but I have done my research. Yes, you’ve looked at things like capital cities and trends in price growth. But, are you doing it right? The problem with the type of research many do with real estate investment is perspective. Many first-time property investors lack perspective in their property research.
Furthermore, many of them have one misconception about conducting proper research. It is common to find first-time investors believing that the only thing they need to know is their area. In other words, they think it basically involves knowing their local neighbourhood. There is also the element of knowing investment fundamentals of a property market.
With these two, beginning investors believe they’re knowledgeable in property investment Australia. That said, there is one sure way of doing it right when thinking of doing your research properly. So what is it? Well, hiring independent mortgage brokers, Metropole property strategists, real estate agent and strategists. This team of experts will help make this process easier for you.
Thinking of starting out in property investment Australia? You definitely need a team of experts behind you to help you make the right decision. Here at Duplex Invest, we have a great deal of well-experienced representatives. There are in a position to offer you valuable expert advice sure to guide you the right way.
If you would like to get in touch one of our representatives, do get in touch via phone by dialling 0410 314 179.