While we could all dream of owning and living in our dream homes, decorating and aspiring to lead the good life. Very often forgotten are the initial steps of acquiring the property. Here is a brief guide as to what you should look out for in your next property investment including the possible pit falls.
Location
This may not be as easy as you think. If you are entering into property development as an investment, a good location does not mean the best location in town. Buying near the city would mean the highest prices and leaves little room for profit. The property needs to be in a location that will suit a particular audience. Transportation links are often important for young professionals who want to reach the City but live in the suburbs. Popular locations will always find tenants to occupy the property. Good locations could be those that are on the fringes of a good area, which may in time be incorporated within them.
Make Money Buying NOT Selling
This may seem a bit strange and against logic, but it essentially means you need to make sure you are paying the right price for a property and not hoping market conditions will push you into profit. Paying top dollar for a swish property no matter how well furnished will knock heavily on any profits you hope to make. Search for selling properties with planning application. They may accept a decent price subject to planning permission and if later approved will hold far better prospects.
Under The Hammer
Auctions are always a good place to pick below market value prospects, provided you exercise good restraint. Set a limit and don’t get carried away. Taking along someone to act as a restraint who has no interest in the property will help keep your emotions in check. If bids don’t reach the reserve price for the property you could always try to negotiate with the seller afterwards, after all, the property wouldn’t be at auction if they weren’t keen to sell. Just remember the property you want is not the be all and end all, there are plenty more opportunities.
Avoid the Pitfalls
Always protect yourself. Think, in the worst case scenario can you still come out unscathed? Never rush into buying and have your emotions take the lead, there are plenty more deals around the corner. One mistake could lead to a financial headache that could last years.
Be sure of the surrounding you are buying into, are there noisy neighbours? What’s it like at night? Are there any restrictions attached to the property? Check out the property carefully, is there structural issues? Asbestos etc.? There are always deals to be had, it is much a case of doing the hard work of finding them. Whatever your budget there would always be a deal to suit you. Just remember every cent saved is a cent in your pocket.
This is a guest post by Alan from IPIN Glogal
Image by thinkpanama