If you’ve decided to invest in property, then you have made the first big move towards securing your financial future. Congratulations are in order! Property investment is a great way to make extra income through rent to help cover mortgage repayments, but also allows you to benefit from depreciation claims and capital gains. We could go on forever about how beneficial investing in property is, but instead we believe one of the first steps you should take is to assemble your team of property experts before making any investment.
While investing in property can be relatively low maintenance in the long run if you engage a real estate agent or property manager to manage the property, it does require you to engage a range of different experts upfront to ensure you make the right investment decision and get the transaction done efficiently. Below are the different stages of the property investment journey and when you should consider engaging each group.
Who Should You Have On Team When You’re Investing in Property
Step 1: Finance
Before you can even look at investing in property, you have to prepare your financials. This will be different for everyone, but it is important to be ready with a pre-approval so that you can move quickly when the right opportunity arises, and to make sure you are looking at properties within your investment range from an affordability perspective. With property prices increasing all the time, especially in Melbourne and Sydney, you can lock in a cheaper price if you are prepared.
Who should you speak to?
Broker: A Mortgage Broker will assist you with the following:
- Evaluating your needs and determining what your borrowing capacity is
- Help compare your options, both small lenders as well as the big four banks
- Give expert advice to assist you in picking the right lender for your needs
- Do you hate paperwork? Don’t worry, the broker will look after the entire application process
- Assist in getting you pre-approval on your loan
Financial Planner: Got a financial goal but don’t really know how to reach it? You should engage with a financial planner to help map out your investment objectives and establish an overall investment strategy. They can assist you on how to invest, save and plan for your future.
Accountant: An accountant can assist you with preparing a budget, advise on available tax benefits, and help you understand the cash flow outcomes of different types of investments including rental income from your tenants. They could also help you build your property investment portfolio and then manage the ongoing tax affairs related to your growing portfolio.
Lender: Unless you are investing in property with cash (lucky you) then you will need to speak to a lender. You may already have a lender from previously borrowing, but if not or if you want to compare other options, most people will speak to a mortgage broker to get the best deal. When you are choosing a lender you should look at:
- Can you have a split loan?
- Flexible loan time
- Can you use equity from your existing home?
- Fees that they charge
Property Valuer: Property Valuers do exactly what they sound like they do. They assess and value of your property. They will then communicate to your lender what they think the property is worth, affecting how much you can ultimately borrow. The valuer will typically be appointed by the bank, or you may be able to select one from their panel of valuers.
Step 2: Investment Selection
During this stage of the investment property journey you will need to start looking at what is available in the market. This is why having finance pre-approval upfront is a great idea because you will be able to jump right in and find a investment property that works best for you.
Who should you speak to?
Specialist Agents: Whether you are a first time investor or have been doing it for years, talking to a specialist agent will make the process straightforward and simple. If you are considering a new build (off-the-plan house and land package) investment experts at iBuildNew can support you through every step of the process. Applying the iBuildNew investment research methodology, they will hand pick investment opportunities from their extensive panel of wholesale builders to find the property that will work best for you.
Research & Education Provider: Property investment can seem complicated but if you get the right advice and do some research prior to choosing a property, you will make an informed and beneficial decision. Again the experts at iBuildNew will provide education in off-the-plan house and land packages and how you can benefit from such an investment, with all recommendations backed up by their research and supporting data from Core Logic.
Step 3: Transaction and Property Management
You’ve chosen to start investing in property, now it is time to sign the contract and move closer to your plans of securing your financial future. You will still have to maintain relationships with prior advisers throughout this stage such as your mortgage broker, accountant, etc, however, there are a few additional professionals you should consider engaging.
Who should you speak to?
Conveyancer: Typically, when you purchase a House and Land Package or land, you will have to speak to a conveyancer to transfer the land title to you from the previous owner (or vendor). They can also help you with a contract review which is a great idea to make sure you understand what you are signing.
Property Manager: When you start leasing your property, most investors don’t want to be dealing with all the applications and then any tenant issues etc. Hiring a property manager means that they will get a suitable tenant, deal with any repairs or disputes with the tenant and advertise your property as and when needed. For a relatively small fee they can take away all the administration associated with property investments and are highly recommended.
Insurance Broker: You will need an insurance broker when you start renting your investment property out to tenants. It’s important you consider securing a policy that will cover you for:
- Tenant theft or default
- Income protection
- Damages
- Electric faults
- Repairs and maintenance
Let iBuyNew Help You
Need help getting started? iBuyNew will point you in the right direction! Whether you are looking for apartments, townhouses or house and land packages, working closely with an iBuyNew property consultant, who understands the market, will help you find something suitable that’s tailored to your needs and requirements. Get in touch with them on 1300 123 463.
Zoe Langenberg
Zoe is passionate about coffee and interior design. You can find her most weekends exploring an art gallery or devouring a good book.
1800 184 284
