First Investment Property - Help Needed!

Learn more about investing in Australian real estate & share your ideas with other investors.
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jasmine
Posts: 46
Joined: Mon Jun 15, 2009 1:45 pm

First Investment Property - Help Needed!

Post by jasmine »

Hello… I've had a look through your website and I’m really impressed with the detailed info you have, so I was hoping you could help me with the following:

I'm planning on purchasing my first investment property however I’d just like some advice on what I need to know before going ahead with this. Basically I want to know what things I should consider & look out for, including whether it is best to buy a fairly new house or unit or go for an older house for the same price but would probably have more capital growth?

Any advice would be greatly appreciated! I'd like to start investing as soon as possible... Thanks!

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Tina Pham
Mortgage Specialist
Posts: 175
Joined: Thu Jul 22, 2010 9:41 am
Location: Sydney, Australia
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Re: First Investment Property - Help Needed!

Post by Tina Pham »

Hi Jasmine,

Investing in real estate for the first time can be a very overwhelming experience especially if you have never purchase a property before. While I am far from a real estate investing expert I have actually bought and sold many properties over the last few years. The most important thing for first time investors is to educate yourself before buying any real estate.

Things to consider are why do you want to invest in property? Do you want to invest short term (renovate and then sell) or long term (until property is positively geared)? One of the most important things when it comes to property investment is location, location, location! Prices and comparative sales data can vary from suburbs to suburbs. The safest bet is to pick an area that you are familiar with so you can watch it closely. Once you have enough experience then you can venture into different areas and even states.

The one thing that you can’t control is the property cycle so always make sure you know where you are in the cycle. Generally you want to invest when the market is slow rather than when it is peaking. This is not to say that you can’t invest when the market is at its peak only that it is important to ensure the property is in areas where the prices are quite stabilized rather than fluctuating.

Planning is also very important when deciding to invest in real estate. Getting a good mortgage broker to handle your finances and a good conveyacer to handle your purchase will be the key to your success. Also ensure you know how much you can realistically afford and stick to your budget and goal. Good luck and if you have any other questions please feel free to post it on our forum.

Tina
Tina Pham
Senior Mortgage Broker
Ph: 1300 889 743
The Home Loan Experts

jasmine
Posts: 46
Joined: Mon Jun 15, 2009 1:45 pm

Re: First Investment Property - Help Needed!

Post by jasmine »

Tina, thanks for your quick reply! Are you able to expand on what you mean by when a "property is positively geared", and what the difference between positively & negatively geared properties are?

Thanks,
Jasmine

kathryn
Posts: 13
Joined: Wed Jul 21, 2010 7:06 pm

Re: First Investment Property - Help Needed!

Post by kathryn »

Hi Jasmine,

Well Done for deciding that you’re going to invest in property! For your first purchase it’s always confusing, intimidating and hard to make decision on, however it’s all worth it! I’ve personally bought 11 properties and it’s a great process with the right team around you.
You first need to talk to a finance person, such as a mortgage broker, who will be able to chat to you about your options are with your financial situation at the moment and start your pre-approval process.
After you have found out the amount that you’re able to spend, then you need to think about the area that you wish to invest in. When you’re looking for a suburb you’re looking for great transportation links, both bus and train, schools in walking distance, shops within 5 minutes drive, 10 minutes walk, and if possible close to universities, hospitals, parks or other pluses that will bring in tenants to live in your investment. Always remember that if this purchase is an investment, then it’s not for you to live in, the act of property investing is a numbers game that needs to add up.
Once you have found the suburb/s that you’re interested in then you need to look at your budget and see if you can afford a unit, townhouse or house. Their all have their cons and pluses, however the younger the age of the property will allow you to claim back expenses on the building and permanent fixtures. You should talk to your accountant about that.
Then it’s time to hit the streets, study the local papers, the internet, the local real estate offices to see what is on the market at the moment. Don’t buy the first thing you see! Look around, find out what other properties have sold for in the last couple of weeks, start to find out what certain properties are selling for at the moment.
Always have a solicitor ready to read any contracts that you offer on. This way you don’t need to rush around when you get an offer accepted.
I have more information on investment properties at http://yourpropertyhunter.com.au/blog/?p=17
Good Luck
Kathryn

BillyNudgell
Posts: 1
Joined: Wed Jan 26, 2011 8:47 am

Re: First Investment Property - Help Needed!

Post by BillyNudgell »

Hi Jasmine

I found the investors club to be a valuable source of information about property investing. They are a group of people who invest in property and share their knowledge at regular meetings. There is likely to be a group in your area. You can find them with a simple Google search.

I hope this helps.

Chanetsa

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