Tips for beginner?

I have been interested and reading about property investment for years, and now i'm old enough to start. Any tips on where to begin and with what kind of property/strategy. I know the strategies and stuff, just not sure which one to use and how to piece it all together in a practical way.

Any information is handy.
:)
 
Before buying any IP, the first thing I do is sort out the finances. Probably even more important now that lending criteria appears to be tightening.

Once you know what you can afford to borrow then you can proceed to look at investment choices.
Marg
 
A question that could take reams of paper to answer on.....but just bite the bullet and buy a property at an affordable level for you and grow from there.....I think thats how we all started actually....you really need to do some searches on here as it's all been discussed at length...including the negative views just to make sure you are determined to go thru with it....:cool:

Good luck.....maybe suggest a strategy you are most interested in then someone may be able to elaborate as there are many....
 
I have been interested and reading about property investment for years, and now i'm old enough to start. Any tips on where to begin and with what kind of property/strategy. I know the strategies and stuff, just not sure which one to use and how to piece it all together in a practical way.

Any information is handy.
:)

What are you wanting to ultimately achieve from property and what time frame. That coupled with your personal risk profile dictates what strategy best suits you.

Do you have answers to those questions?
 
as marg said, I'd start with looking at what you can borrow...This gives you a context of sorts which can hep you determine next steps - strategy/property types / tactics etc..

of ourse answering rxiter's question t this point will assist this...
 
Before buying any IP, the first thing I do is sort out the finances. Probably even more important now that lending criteria appears to be tightening.

Once you know what you can afford to borrow then you can proceed to look at investment choices.
Marg

What are you wanting to ultimately achieve from property and what time frame. That coupled with your personal risk profile dictates what strategy best suits you.

Do you have answers to those questions?

To both. My partner and i are both really interested and for now are just saving up enough for a deposit, then plan to buy next year and i just want to be sure on what i'm going to do.

Like most people, i want to make a lot of money, i prefer cg over cf. I like the idea of buying run-down properties and renovating them. It's just i need some more information on basically getting started such as where to buy (i live in Sydney), and how much to spend on it and what i can expect.

Thanks everyone for responses:)
 
Your questions are far too big to generate meaningful replies, IMHO. There is no single strategy that's "the best"; fortunately there are many ways to profit from property investing.

Perhaps a couple of my blogs will help you refine what you want to do, such as "How active or passive do you want to be?" and "Developing the right property investing strategy for your circumstances".

Maybe after reading and considering those, you can come on with a more focused question, such as:

"I'd like to accumulate a portfolio of houses in the lower price range, in areas that I believe will gentrify and thus undergo significant growth over the next 20 years. I'm thinking of initially focusing on either suburb A area of Sydney, or suburb B area of western Melbourne, and would appreciate your thoughts as to the future prospects of these areas."

You need to ask a question specifically about finance, or about analysing deals, or about selecting areas to target, etc.

You can make a profit buying almost anywhere, long term. More important than picking the right market, is picking a market and getting to know it well. This will enable you to readily spot good deals within that market. Choose somewhere, then start looking at all the listings, going to OFIs, studying statistics on growth, etc.

Your question, as it is now, is really so broad that it reads "somebody tell me what to buy and when so that I can get rich", and sorry, but nobody lays it out like that for you. And if they do, be highly suspicious - they're probably selling you over-priced property on a hefty commission!
 
And decide how far you are willing to travel.

Eg, there's a house here that is positively oozing character, structurally sound, but needs some serious cosmetic work so noone wants to buy it. Its been for sale long enough now that the price has just dropped about 20k. Once that happens, usually someone buys it for considerably less than the original asking price - or not at all since renovator's delights here are very unpopular as this town has a major snob complex :rolleyes:

Restore that one from a 'needs work' to a 'beautifully renovated heritage home with period features' and you've made a minor fortune without a big spend and will probably sell it in 5 minutes for close to twice what you bought it for.

Anyone in Adelaide looking for a project? :D
 
You can make a profit buying almost anywhere, long term. More important than picking the right market, is picking a market and getting to know it well. This will enable you to readily spot good deals within that market. Choose somewhere, then start looking at all the listings, going to OFIs, studying statistics on growth, etc.

Your question, as it is now, is really so broad that it reads "somebody tell me what to buy and when so that I can get rich", and sorry, but nobody lays it out like that for you. And if they do, be highly suspicious - they're probably selling you over-priced property on a hefty commission!

Thanks for that. Was really helpful
 
it may seem overwhelming, but i'd suggest you do the math on around 100 properties before you buy - even if it's just "back of the envelope" sums on a property in the paper - to give you a feel of what is possible.

go to open homes of unrenovated, and renovated properties and look at what has been done, what works and what doesn't, and what sells.

a major stumbling block is overcapitalising. don't do it. a purchasers will not notice the different between a $100 tap set and a $1000 tap set if the bathroom is "wow" (same applies to most fittings).

as an example of over capitalising that i learnt about this week ... our neighbour bought their house for around $600k, gutted the entire property, extended and rebuild for a cost of close to $600k - so they spent $1.2mil. properties in our street sell for around high $800's. it'll take them a heck of a long cg timeframe to make their money back.

another neighbour proudly showed me their new bathroom reno and blurted out that the fittings and tiles alone cost $15,000 (cistern hidden in wall, egg shape free standing bath, rainforest shower head, ceramic tiles - no labour). i nearly keeled over. we're currently doing a bathroom and last week all the fittings cost me around $1000 (fully ceramic toilet, shower bath, ceramic top wall mounted vanity etc). i haven't added in tiles but at $22/m2 i don't think they'll add another $14,000 - and the bathroom will be just as "wow" by the time i've finished.
 
sorry - got a bit side tracked from the question with those mindblowing overcapitalisations.

what i have found very helpful is to work out what age you want to retire and how much (in today's dollars buying today's items) you will need to live in the style you want ... then work out what you need to do/buy/make to get there.

for example - i want a passive income of $150k/yr (less tax). to do so we need 10 full owned townhouses. to gain those we need to develop/build around 16 townhouses, wait Xyears for cg and sell some to pay out the debt on the balance.

so, to build 16 townhouses, we need to develop 4-5 sites of 3-4 townhouses each.

quite do-able over a 10 year period.
 
My tip is that strategies don't really make that much of a big difference, there are multiple ways to make money from property investing.

JUST START!!!

all the best. X
 
My tip is that strategies don't really make that much of a big difference, there are multiple ways to make money from property investing.

JUST START!!!

all the best. X

This is great advice Xenia. With the multitude of strategies available, it can become confusing and cause 'information overload.' Or analysis paralysis, meaning that you don't end up doing anything at all!

Perhaps you could buy an investment property that you can afford to hold for the long term, is in an area that will grow over time, and that will rent reasonably easily. Pay it down to increase your equity and when the time is right for you go again!
Be interested to hear what you decide to buy.

All the best,

Regards Jason.
 
for example - i want a passive income of $150k/yr (less tax). to do so we need 10 full owned townhouses. to gain those we need to develop/build around 16 townhouses, wait Xyears for cg and sell some to pay out the debt on the balance.
Hehe ... we want a passive income of $25k plus an owned PPoR. That's two houses plus some shares or something to make up the difference.

Out here, that could be done quite easily by just buying a block of land that is over 20m wide and plunking a duplex on it. But that's a bit out of our league right now.

However we have other non-property things we want to do in the meantime that property will kickstart the funding for, and then end up paying for it all.
 
it may seem overwhelming, but i'd suggest you do the math on around 100 properties before you buy - even if it's just "back of the envelope" sums on a property in the paper - to give you a feel of what is possible.

''as an example of over capitalising that i learnt about this week ... our neighbour bought their house for around $600k, gutted the entire property, extended and rebuild for a cost of close to $600k - so they spent $1.2mil. properties in our street sell for around high $800's. it'll take them a heck of a long cg timeframe to make their money back.''

wow thats crazy. I couldnt imagine spending 600k on a house costing 600k. The other day my partner and i went to Bunnings to check how much everything costed and it looked alright. Speaking of tap sets, there was a really nice one for only 140 which would definately be wow factor.
Your answers were so helpful. Thanks.
 
My tip is that strategies don't really make that much of a big difference, there are multiple ways to make money from property investing.

JUST START!!!

all the best. X

Thanks Xenia. Yeah we are planning to start soon, within 4-6 months. We want to learn as much as we can from books etc and dvds.
 
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