Buying a second property can be a great investment, but it’s important to make sure you are ready. Here are the seven signs that show you are ready to invest in property – and some tips to get you there.
You have done the research
As a property investor, there is plenty of background work to do. Read up on investment guides, tips from other property investors, the property market and where it is heading, what is expected of you as a landlord, and any costs you will have to cover after you have purchased the property.
You are financially ready
If you are struggling to pay your current mortgage and bills, it may not be the best time to invest in another property. Think about whether you can afford to take on another property and the associated financial responsibilities, and whether an investment property would be more of a burden than an asset.
You have created a budget
Budgets are boring but essential. Create a budget to assess whether you can take on another property. The budget may also help you to arrange your finances in a way that works better for you.
You have loan pre-approval
There’s no point looking into property investment if you can’t get the financial backing to buy. Check out your eligibility for a home loan by getting loan pre-approval. This will give you the confidence to buy, and it should help you stay within your budget. A mortgage broker could help make this process – and the property investment process – much easier.
You’ve found an area to invest in
Finding the right area to invest in is essential. Research up-and-coming areas to get a good deal, and think about what kind of tenant you are looking for. If you want to rent to uni students, choose a suburb close to a uni that can offer affordable rent. If you are looking at the holiday rental market, choose an area that would interest holidaymakers. And so on.
You’ve found a property
Finding the right property is key to making your investment a success. Do your research and a find good real estate agent to help you with this choice, and be sure to carry out all necessary building and pest inspections. Make sure the property will suit the tenants you are aiming to target.
You have created goals
As an investor, you should have investment goals. Determine what goals you have as an investor and work out how you are going to achieve them. This could include retiring early, increasing your income, or living off your property investments.
Time to invest!
If you have covered all the above points, then it could be time to become a property investor. Be sure to look for the right investor loan, and consider speaking to a mortgage broker, as they could help guide you through the process of investing, offering valuable advice when needed.
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