Tips for Property Investing

Consider using the equity in any other property you own.

Tapping into your home equity, or equity from another property investment, is a great launching platform for buying an investment property. Say your home is valued at $700,000, you owe $350,000 on your mortgage and you want to invest 10% of the equity (or $35,000) into another property. You can do so provided that you comfortably afford your repayments.

Think about buying with friends, family or work colleagues.

You can pool your resources with friends or family to help you get into the market. As long as together you can pay off the loan, it doesn't matter if one party earns more, or has greater liabilities, than the other(s). The only difference is at the end of the loan term the property might not be owned in equal parts. An initial visit to the solicitor should result in a contract that outlines who pays what and how much of the property each applicant will own after paying off the mortgage. Although you can purchase property in this manner, Viking advises to be careful of the pitfalls of this type of investment structure. Call our office for more details.

Choose a loan tailored to your current needs.

There are many different home loan options to suit you. Will you go with an interest only or a principal and interest loan? Fixed or variable rate? Which features are needed? Will you provide a deposit or choose a 100% or even a 110% loan? Apply for a loan that suits your current needs and lifestyle because you can always refinance later. With new products entering the increasingly competitive mortgage market, and reputable mortgage brokers such as Paul Habib of the CBA elite team providing free Home Loan Health Checks you can always change your loan situation further down the track if it's advantageous to do so.

Use Viking To Buy Property

Seek advice about the type of investment property that will maximise your investment. Viking Acquisitions are a valuable resource to use for advice or for negotiating with property sellers and/or their agents.

You need to make sure that your financial situation is improved by an investment property and that you can afford repayments without stretching the budget uncomfortably. Remember, you must make this investment work for you and your long-term strategy. Viking Property can provide you with a Property Investment Analysis you can take to your accountant with cashflows and returns calculated to assist in the decision making process.p>

Like all investments it pays to do your homework before you take the plunge into property. But even with rising interest rates, a sound strategy can pay off. The shortage of rental properties, combined with rising prices in most markets, means that if you choose the right property and make sure you keep a close eye on your investment, you could reap the rewards.

Take a long-term view and realise that investing in property is usually a long-term strategy

The housing market is generally a 7-10 year cycle; there are always highs, lows and steady patches. Make sure you're comfortable with how much you're borrowing, and you know what your financial goals are. Plan ahead - you may find a long-term tenant or you may find that your tenants come and go.Make sure your cashflow is sufficient so that you can cover the mortgage and other outgoings while the property is empty.