Thinking about investing in property but not sure where to start? Don’t worry – you’re not alone! The latest data from the ATO suggests that more than two-million Australian’s own one of more property. That means that more than 8% of the nation can call themselves property investors.

Property investment is a great way to make money and build your wealth. However, purchasing property is not without its risks. Before you invest in property, it’s important to do your research and understand the potential risks and rewards.

At Property Returns, we are all about managing risks and ensuring maximum return on your property investment. For that reason, we see more than our fair share of excellent (and questionable) investing strategies. Here are eight essential tips that novice property investors need to be aware of before getting into the market.

The Essential Property Investment Tips For Beginners

1. Do Your Research

When it comes to property investment, knowledge is power.

One of the most important investment tips is to keep an eye on the market. By monitoring market trends, you can make sure that you’re buying property when prices are low and selling when they’re high. This will help you maximise your profits and minimise your losses.

The more you know about the market, the better equipped you’ll be to make wise investment decisions. Be sure to read up on as much as you can about the ins and outs of investing in property before you take the plunge.

2. Have a Solid Plan

Investing in property is a big undertaking, so it’s important to have a clear plan in place before you get started.

It can be all too easy to get caught up in the excitement of buying a property and forget what your ultimate goal is. Having a plan will help you to keep your eye on the prize and make sure that you don’t make any decisions that could jeopardise your chances of achieving your goals.

Think about (and refer back to) your goals and what you hope to achieve by investing in property. Once you have a good understanding of your goals, you can start to put together a plan for reaching them.

property investing tips about making goals

3. Get Help From a Professional

Our top property investment tip for beginners? If you’re new to property investment, it’s a good idea to seek out the advice of a professional. There are many different aspects to consider when investing in property, so it’s helpful to have someone who knows the ropes to guide you through the process.

4. Location, Location, Location

When it comes to real estate, location is everything. The median house price in Sydney is $1,142,000, while the median house price in Perth is just $545,000. With that said, the rental and buying market do not necessarily mirror each other with Perth rentals achieving around a 2/3 to the dollar investment despite costing less than half.

Be sure to do your research on different areas before you choose a property to invest in. Consider things like the local economy, population growth, and infrastructure when making your decision.

5. Know Your Budget

Investing in property can be a pricey undertaking, so it’s important to have a solid grasp on your finances before you get started.

Sticking to a budget will ensure that you don’t over-improve the property, which can lead to negative equity if you then have to sell it at a later date. It’s important to remember that most properties are only worth what someone is willing to pay for them – not what you think they’re worth.

knowing your budget is an essential investment property tip

6. Have a Realistic Timeline

Investing in property takes time and patience. It can take months, or even years, to find a suitable home to purchase. The average time taken to find a rental property has increased from 12 weeks in 2013 to 23 weeks in 2017, according to the latest figures from the Australian Bureau of Statistics (ABS).

Don’t expect to see immediate results from your investment – it can take years for a property to appreciate in value. When creating your timeline, be sure to factor in some flexibility to account for potential delays.

7. Be Prepared for the Long Haul

Investing in property is a marathon, not a sprint.

Investment properties in Australia offer a great opportunity for earning a return on your investment. The average investment property in Australia generates a return of 6.8% per year. This means that if you invested $100,000 into an Australian investment property, you could expect to earn an annual return of $6,800.

Be prepared for the ups and downs of the market by having a solid plan in place and sticking to it for the long haul. Remember, Rome wasn’t built in a day – and neither was a successful property portfolio.

you don't need to rush when it comes to investing in property

8. Diversify Your Portfolio

It’s no secret that diversification is important when it comes to investing. This is especially true in Australia, where the property market can be notoriously volatile. By spreading your investments across a range of different asset classes, you can minimise your risk and maximise your chances of achieving your financial goals.

Investing in multiple properties is a great way to reduce your risk and maximise your chances of success. By diversifying your portfolio, you’ll be better prepared for market fluctuations and less likely to experience financial hardship if one of your investments doesn’t perform as well as expected.

Final Thoughts

By following these tips, you’ll be on your way to becoming a successful property investor. Just remember to do your research, have a solid plan, and be prepared for the long haul. With a little time and effort, you can achieve your investment goals and build a thriving property portfolio.

Looking to make the most out of your investment? Property Returns are Australia’s leading quantity surveyors, providing reliable tax depreciation schedules for property of all shapes and sizes. To learn more, get in touch with the Property Returns team today.