Being an Australian resident, you might be well aware of how popular it is to invest in a property in Australia. Have you ever wondered why?
We understand that property is an expensive investment, but having said that, it is the safest asset with a high scope of capital growth. Thus, investing in properties is very popular in Australia. Buying a house is an emotional investment along with financial, but buying an investment property is a strategic approach. If you proceed with this strategic approach, you are on the path of financial flexibility and freedom.
Our financial experts at APW Finance have documented a few guidelines to guide you through this entire process. Read on to know more.
Knowing And Understanding Your Goals
Property investments are often compared to running a business as it is a massive form of passive income. But to ensure that you are earning profits on your investment, you must keep the product desirable and profitable. It would help if you planned right from the beginning. It is essential to anticipate your long-term, your medium-term and your short-term goals before investing. You should know why you are investing, is it for long-term retirement, medium-term wealth creation or short-term rental return. Once you understand your requirements or your goals, they become the foundation of your strategic investment. You will automatically start thinking about the property’s location, the time-frame, the type of the property and the amount of investment you are willing to make.
Sorting All Your Finances
Finance sorting is an essential part of property investment. You must be well aware of the ongoing expenses apart from the home loan repayments and borrowing capacities. You must consider;
- Profit or Loss Forecast
- Property Maintenance and Repairs
It is a standard procedure to utilise the rental money to support mortgage repayments. Still, there are chances that you might face a shortfall between the repayment amount and your rental amount. It is essential to be prepared to face such a situation as you will have to additionally contribute funds apart from the rental money to repay the monthly mortgage. If you are already an owner of a house, you can use the equity amount towards the deposit. The amount remaining after subtracting the loan amount from the market value of the property is equity.
Locating The Right Property
Once your finances are in order and your goals are clear in mind, now is the right time to start selecting the property. This is the prime decision to be taken. The two main factors to take into consideration are property type and property location.
You must research the area very carefully before buying a property or go for the area you are well acquainted with. Consider the properties that have a desirable location to live in. You can contact the local agents to understand the location better, and we at APW Finance are always there to help and guide you through.
Once the location is finalised, now is the time to select the property. Choose a property that fits well with your budget. Again, we are there to help you on this front as well.
You can contact us today for more information.