02 Sep Small Property Development Overview
Choosing the right Small Property Development isn’t as easy as it seems, Navigating the law, taxes, funding, grants, research and much more can be a stressful experience even for the most seasoned investor, The Giumelli Group has over 18 years of experience and will take the heartache out of Small property Development.
Here are 7 tips to purchasing a Small Property Development
1. Adequate research
Will it provide the gains and returns you require? It is in the best location to attract quality tenants?
Will it appeal to the owner occupier market that sustains property prices in the long term?
It is important not to become emotionally attached to a property, investing is all about the economics, not the emotions.
2. FAIL TO PLAN! PLAN TO FAIL!
Set goals, determining where you want to end up, and then devising a cohesive plan to get there.
You need to focus on your overall strategy. Work out what you want to achieve with regard to income – are you chasing short term yields or long term capital growth
Determine the type of property you need to buy in order to meet your income goals
With a carefully thought through outline of your investment journey, you will end up exactly where you want to be.
So plan your action and then action your plan.
3. TAKE YOUR TIME!
Two of the most common mistakes of Small Property Developers who never make it beyond their first property are too impulsive or overly cautious
Small Property Development isn’t a get rich quick scheme, Research is key, seeking a professional Small Property Developer such as The Giumelli Group will ensure the right research is done and informed decisions are made
Attending every seminar, reading all the books and watching all the DVD’s, is a waste of time and money if action isn’t taken
Find a happy medium – learn as much as possible and be comfortable with your investment decisions, surround yourself with likeminded Small Property Developer and seek help professionally.
Use other people’s money!
Going through a broker before applying for a pre-approval can be beneficial if you’re not sure you’re financially ready to invest.
Applying for multiple pre-approvals can be damaging, every time you apply, lenders will check your credit record. If there are multiple inquiries, a red flag is sent to the banks which may prevent your application.
There are multiple ways to find financial backing, don’t be afraid to explore your options, don’t be “loyal” to a particular bank, they all compete and they all want your money, seeking advice on who to borrow from is important though, The Giumelli Group has over 18 years of borrowing experience
The best advice The Giumelli Group can give any beginning property investor when it comes to financing your property investments is to seek help from a qualified, professional mortgage broker.
Going it alone can be daunting and time consuming and obtaining the right type of finance can save you thousands in the long run.
Setting up the wrong financial structure can be just as detrimental to your investment endeavours as selecting the wrong type of property.
5. NOT DOING YOUR HOMEWORK
Understanding property markets takes time.
So don’t think you can attend a seminar or two, or read a couple of books and have a handle on exactly what to buy.
You need to know the neighbourhood you intend to invest in
Make yourself completely familiar with any given area by pounding the pavement and talking to the locals, real estate agents and property managers.
Find out all about the amenities, vacancy rates and historical values of properties in the area.
When you know the area, get to know the street you intend to buy in and the property you intend to buy. You can never know too much about your Small Property Development!
6. DEVELOPING THE RIGHT PROPERTY
Know your market, is your Small Property Development in a suburb that predominantly attracts families or young, single professionals?
The demographic of an area will make a big difference when it comes to what type of property you buy.
7. BE THOROUGH
Have you really done every little bit of research into the investment?
Do you know why the vendor is selling?
Knowing the vendor’s motivation can make a big difference when it comes to negotiating a good price.
During the initial inspection look for clues as to the vendor’s personal situation, it might sound a little callous, this gives you an opportunity to buy a bargain, as well as giving the seller a chance to move on with their lives.
Have you had the relevant inspections done to uncover any structural defects or signs of pest infestations?
The fees for these are tax deductible and paying say $800 for this type of peace of mind can save you thousands in the long term.
Focus on your goals!
In order for you to achieve your goals, you must first articulate what your goals are. More importantly, you need to set a deadline as to when you want to achieve them.