At this time of year the attention of the nation turns to the races and debate emerges about our great love of a bet. In a country where we’re prepared to bet on two flies climbing up a wall should you consider real estate a ‘safe bet’? (read more)
I believe strongly in the integrity of real estate as an investment but I readily admit there is no such thing as a ‘sure thing’. So to ensure your property purchase is a good bet there are a few key points to consider.
1: Seek financial advice. Clarify your budget and the best way to structure your finances. Paying to get professional advice can save you money and angst. For example a financial adviser can outline the positives and negatives and legal requirements related to purchasing a property using a self-managed super fund. That is an increasingly common question in the real estate world but one I am not professionally or legally able to answer.
2: Identify your time frame. I’m actually not talking about the timeframe to purchase but rather the timeframe you anticipate and would ideally like to hold the property. Real estate is best considered a long-term investment so be realistic when calculating desired capital gain and evaluating the future growth prospects for your desired location.
3: Look for possibilities: Just like in the Melbourne Cup you don’t have to back the favourite in order to pick a winner. A property that needs some work can represent a great investment if you get it for the right price and are prepared to put some effort into the fix.
4: Be honest: You are only fooling yourself if you overestimate your budget or the potential capital growth of a property.
Again, I stress there is no such thing as a ‘sure thing’ but with the right preparation, advice and consideration real estate is a good bet.
Good luck on Tuesday. I was going to give you my tip….but think I’ll follow my own advice as outlined in Point 1 and leave that to the experts!