Property Investment for Beginners Truth #1
Let’s be honest, investing in property isn’t that easy. If it were everyone would do. The fact is that only 30% of the population invest in property. If you want to be a part of that pie, then learning how to invest in property will become your second full time job for the next 12 months. And that is before you even begin to look at real estate.
Before investing in your first investment property it is important that you do one of two things;
1) Invest time and effort into learning everything you possibly can about property investing
2) Hire an expert to do the job for you
If you want to DIY your property investing as a beginner you should expect to invest at least the next 12 months learning everything you can about property. The learning curve can be fun and exciting if you love reading books, spending time on forums and investing weekends attending educational seminars and courses.
Before you buy anything (even a course, education, coach or a property) there are some things you need to watch out for! So make sure you leave your credit card at home when you attend educational seminars.
Property Investment for Beginners Truth #2
Buying a property to invest in is very different to buying a home to live in.
When you purchase your own home you think about all the things that you personally want and need in a home. Things like how far you want to be from your work, family, transport. Whether you want to be in a beachside location, the hills of the inner city. You create a wish list that is based purely on your needs, desires and what appeals to you most.
When it comes to investing your decision making process should be different.
What you need to be thinking about as an investor are:
- What are your investment goals
- What time period do you want to achieve it
- Which investment strategy will get you there
- How many properties will you need to purchase over time
Your goals will dictate what type of property you should be purchasing, which state, suburb and what investment strategy to use.
Bottom line – you, your ideas, your preferences and personal taste do not matter when it comes to investing in a property. If you do not have a clear strategy or know what type of property you are targeting, how it will fit into your overall portfolio or why, then you are not yet ready to buy a property.
Property Investment for beginners Truth #3
Everyone will have an opinion.
When it comes to property, everyone thinks they know something (or a lot) about property. Everyone will have a point of view, a “somebody” that you just have to meet with or use as a service provider etc.
This issue is that even those who know very little about property will speak convincingly about it. To ensure you don’t follow average advice, ensure you choose the right people to listen to.
A great person to listen to is someone who has already retired off of their property investments or someone who is already a successful investor of many years.
Beware of those who have purchased a few properties in quick succession. While they have a few properties under their belt, they have not proven themselves to be able to replicate that success over the long term. One year from now that same investor could be selling off their properties to start again because they didn’t get the right advice in the first instance.
Property Investment for Beginners Truth #4
Buying property isn’t always fun
Shopping for a property is almost never fun for most people. Unless you are the exception to the rule and have such a passion for property that you love to live and breathe it, you will likely find yourself feeling a range of emotions throughout the process of buying an investment property.
You will go from feeling excited in your first few weeks of searching to feeling tired, confused and over it very quickly. 6-10 months down the track buyer fatigue will kick in. It is about this time that buyers call a Buyer’s Agent to get the task off their to-do list and out of their mind.
The real estate industry is designed to benefit the seller,
which means as a buyer, the system is against you.
It is never fun when you have the odds stacked against you.
To even the playing field you can hire a professional to short cut your learning curve and get you into your first investment property without all the hassle. The best person to turn to for professional assistance is a Buyers Agent.
A great buyers agent can help you with strategy, right through to acquisition and even help you get your property expertly managed. Just make sure that you hire a legitimate buyers agent with genuine experience behind them. Beware of the fakes and unsupervised new comers.
Property Investment for beginners Truth #5
There will be sacrifices
Property is very forgiving and very generous when held for the long term. But it isn’t always easy.
Ensure you have a good handle on your budget and risk management strategies in place before you invest. There are risks and they can be easily planned for before you begin your journey. If you need help to develop a risk management strategy, a good buyer agent will be able to assist you with this.
Focusing on your “why” will help you push through during those times when it feels a little hard and you want to give up.
Property Investment for Beginners Truth #6
It’s not just about the moneyOwning investment properties can give you a lot of choice and freedom in your life. You can use an investment property to leapfrog into your own home at a later stage, start a business, fund a year travelling overseas while you figure out your next move and much more.
Starting early and starting right will give you the very best chance of success. But it isn’t just about the money. It is about the security of knowing you have something to fall back on. When you become successful in your investment journey it is very likely you will want to help others do the same too.
Property Investment for Beginners Truth #7
If you get it right, you’ll forget you even own a property
There are a few things you need to watch out for if you want a stress free property investment experience.
From buying a property that has ongoing issues, choosing a bad property manager or selecting a property (or property strategy) that doesn’t align with the holding costs that are suited to your financial circumstances.
Get it right on the other hand, and you will literally forget you own a property.
There is nothing better than a smooth running portfolio of property. The only time you really think about it is….well, when you are ready to value it to purchase another! It can be that easy.
But first you need to learn the ropes or invest some money to get a professional to help you avoid the mistakes and pitfalls.
Read some books or take some courses.
If you want to shortcut the learning curve and just get it right from the start then a Sounding Board Session could be right for you.
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