Whether you’re an experienced property investor or you’re now trying to make your first investment, there are many things you need to keep in mind. This particular field has huge potential to make you sizeable returns, however, it is also very risky. There are many potential issues such as falling property prices, tenants who damage your property etc. However, there is also the chance that you can sell your investment property for many thousands of dollars more than you purchased it or make fantastic rental income that not only pays back for the property but fills your bank account. With that said, we will now look at a couple of tips and advice that will help you to make the best investments possible.
First of all, you should always strive to buy properties in areas that are up and coming as oppose to an area that is declining in popularity. Areas where there is increasing demand means that you will surely make a profit and it may even be a great long term investment.
Next, if you’re new to investing, you should not try to make huge or risky investments too soon. Your first couple of investments should be safe ones where you know you will definitely make a return. This means that you should avoid investments such as multi home developments, complete home rebuilds etc. Even if you’re not a new investor, you should still seek help before buying these type of properties so that you can mitigate your risk.
Thirdly, if you intend on purchasing at auctions, then you definitely need to develop a level head and learn to keep your emotions in check. Auctions can easily get out of hand and you can possibly spend too much money on a property or even purchase one that you haven’t even seen. So, before you even go to an auction, make sure that you know your budget and that you’ve looked at all the properties you’re interested in beforehand. You should also set a maximum price that you’re willing to pay and be sure not to succumb to pressure.
Another great tip is that you should learn how to spread your risk and have a diverse portfolio. By doing this, you will protect your capital and get long term security. Therefore, you should purchase a wide range of property types which means houses, student properties, condos, HMOs etc. You should also consider investing in property in more than one country as this will protect you from economic downturn.
Next, you should always build your own personal network of tradesmen that you can trust. When you invest in property, you will likely need to fix them up, renovate and maintain them. As a result, you will have to hire various tradespeople and if you’re not careful, you can easily get ripped off. So, be sure to build up your own network so that you always have affordable and trustworthy workmen to help you maximise on your ROI.
We have just covered a couple of property investment tips that you should keep in mind. These tips will ensure that you make great investments and become a highly successful property investor.