Mention that you’re considering purchasing an investment property and it seems everyone has an opinion or piece of advice to give. We’ve compiled our 5 most popular pieces of advice you should ignore:
Buy in one area only:
A diversified approach will help to add stability to a portfolio – it will also mean you are investing in the best area at time of purchase.
Purchase an investment property because it “looks good”:
The decision to become an investor should come about because a lot of independent research has been completed. If you first consider becoming a property investor because you saw an ad for a property, or went to a home show, what are the chances that the property you are being shown suits your needs, has the best potential for growth and so on! You should only buy property after you know what type of property best suits you.
Listening to someone who has never invested in property:
Investment options are varied. Often when discussing your investment options with friends or family that do not have property investment, they will pass their fear onto you. “You’re crazy! What about shares?” Even statements like “Property is no good” from loved ones can influence your line of thought. Always seek professional advice when choosing investment options – not those of bias, inexperienced acquaintances.
Buy property in an area where there is a one main draw-card or feature:
People may be influenced to purchase because of new infrastructure, this may be a new shopping centre. Although a new project may provide short term interest gains, it’s hard to see this providing solid long term growth. A new shopping centre might be great – but what about its access? If a railway line is planned, and new freeway or other facility planned, suddenly these combined projects helps make an area better for long term growth. Numerous projects helps increase property value.
Buy into a hotel or serviced apartment complex in a holiday area:
This type of purchase is usually made on the basis of being able to get some personal benefit. Traditionally, these types of property may have good yields but usually have poor growth records. A great holiday place is not necessarily a great location for investing.
Property Friends is a specialist Property Investment Advocacy that has been operating for the last 13 years on the basis of 3 principles: Trust, Community & Progress. www.propertyfriends.com.au (03) 9758 5331
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