Investing in property is serious business and it’s important you don’t go in blind. Here are some expert tips to get you started.
- Create a long-term property portfolio plan
Understand that property investing is a long-term pursuit and that property cycles generally involve highs, lows and steady patches over seven to ten years.
- Consider all costs and tax implications
The interest and related expenses you incur on your property (such as repairs and maintenance) are tax deductible. Some properties may be negatively geared – where your loan repayments, fees, and other costs exceed your rental income – meaning the net loss can be offset against your other income. Others may be positively geared, meaning the rental income is higher than the costs. Also, think about the capital gains tax implications if you decide to sell a property.
- Research, research, research
Read articles, use reputable property research companies, search the internet and talk to people to research the areas you’re interested in. Invest the time to fully understand the market – it could save you thousands.
- Consider using your equity
You can tap into your home equity or equity in another investment property as a launching pad into more property, so long as you can afford the extra repayments.
- Think about buying with others
As Australians grapple with affordability problems, some are pooling their resources with friends or family to break into the property market or increase their property portfolio.
- Choose a loan to meet your current needs
Apply for a loan that suits your current needs and lifestyle, as you can refinance down the track.
- Consider using a buyers agent
A buyers agent can provide advice about the best property for you. Buyers agents know the market better than most and can help you choose and buy your property.
- Visit a financial adviser or accountant
You need to discuss your full monetary situation with an experienced adviser to be sure an investment property is right for your situation.
(Source: Mortgage Choice)
Original article: http://www.apimagazine.com.au/property-investment/8-top-tips-for-new-investors