3 Tips To Becoming An Astute Property Investor
When I look back at my journey as a property investor (and now strategist) I realised that there are three important steps that ALL investors must take to ensure the success of their portfolio. So I recorded this video to share my 3 tips on becoming an astute investor! If you would prefer to read along, there is a handy transcription below..
Hi there, Christine Williams from Smarter Property investing;
Today I would like to talk about 3 things I have learnt from becoming an astute investor. The first thing I had to learn was ‘How to protect my income’. The second thing I had to learn was ‘How to remove unnecessary costs’, and the third thing I need to learn was ‘Keep my emotions in-tact and not make irrational decisions or emotional decisions when becoming an investor’.
So, if you want to become an astute investor, not just one of those people that buy the property next door, or look up Realestate.com.au and decide that if an investment property is where you need to go. Please listen to these three things, that I learned, and how I have built a property portfolio on the Australian Eastern seaboard.
The first thing is to ‘Protect my Income’. It sounds silly but, it’s a simple as Landlord Insurance. I made very big mistake many, many years ago. About not having Landlord Insurance and I had a very significant financial loss after there was an accidental flooding in one of my properties and I had to replace the carpet. The cost was way more than the $1,200-$1,500 Landlord Insurance would have cost me. So, protect your income, make sure you have the right insurances, not just income protection, not just TPD, but actual insurance against your property.
Remove unnecessary cost, well think about this is there an unnecessary cost? Its accountants’ questions from my perspective because as an investment property owner now, on 9th May, 2017 legislation changed on Deprecation. Depreciation is a great tax deduction. An established property doesn’t really attract that much now. Other Unnecessary cost: think about Utilities, think about goods and services which you have had added to your property, and whether or not you still need them, whether or not its your obligation or whether or not its going to be your tenants obligation.
The third thing was ‘Keep your emotions in check’. Do not just go out and buy the next property, just because you’ve been to the bank, and bank has told you can borrow X amount of money, and because of that X amount of money $500,000, $600,000, $700,000 or $800,000. Then you have logged onto realestate.com.au and purchased a property at $800,000. Be aware that this is a numbers game. So together with removing unnecessary cost and understanding that you need to have your emotions in check, it’s a numbers game. Make sure you speak to your accountant and/or your financial planner to make sure your number work for You. This is about building a property portfolio, its not about having one investment property and thinking you’re ok with one investment property.
So, to become an astute investor, please take on board the three things that I had to learn on the way. Protecting my income: Landlord Insurance. Removing unnecessary cost: Know your facts and figures, know what you are paying for, know what its going to cost you to get into that property. Do not forget about Stamp Duty, do not forget about Land Tax, do not forget potential Capital Gains Tax. If you know above them, you can put numbers in place to work with them and it will be ok. Then MOST of all, please, please do not make an emotional decision. Make a very factual decision, base it on numbers, base it on your WHY, and is this the strategy for you? And is this the strategy that is going to get you to where you want to go in your financial future.
Following on the 3 things I have learned and explained and shared with you and how I became an astute investor. There are many more thing you do need to learn. I am very happy to share those with you. There has been ‘bumps in the road’. But none of the bumps ever turned into anything other than bumps. So if you would like to know more about what I have learned and how I can help you to become an astute investor, please do call me on my 1300 number, 1300 736 754, or email me on [email protected] and I will be more than happy to share my information and expertise with you.
So, no emotional decision here, make sure to understand the ‘3 Night Sleep Test’.’ If you have slept great for three nights in a row after making this decision, then your ‘gut’ is telling you its OK. Though if you’ve had abnormal 3 night’s sleep, and its keep you up, and really distressed, maybe it not right for you.
If you would like to talk more about all things property – lets chat!
Hope this helps, as I want You to become an astute Property Investor just like me.