How NOT to buy a property

There’s all manner of advice out there for property investors. Just pop your head above the trenches and watch the stampede of talking heads come at you. Some will have useful things to say, while others will be full of bluff and bluster, glossy brochures in hand and nothing of value to share.

This is why I’m so passionate about regulation and advocacy in this industry. It helps weed out the unsavoury elements.

And while people like me and organisations such as the Property Investment Professionals of Australia can push for more regulation, there’s one side of the equation we can’t control… and that’s the buyers.

Unfortunately, it’s buyers who often bring disaster on themselves.

When you look to purchase a property there are some easy paths to acquisition – but there’s also an important distinction between buying an investment property and being sold an investment property.

Here’s my advice on how NOT to buy a property.

Real life

The other day I had an interesting interaction with one of the ASPIRE Property Advisor networks accredited Advisors.

He was new advisor who was actively building his client base by following enquiries and taking calls from potential property investors.

He would field an enquiry and spend time laying out the process whereby we define the investor’s goals, aspirations, wants needs and resources. He’d let them know about formulating a long-term strategy and describe how we carefully analyse data and research information to identify excellent investment locations and prime property types. We then seek to match the client to a specific property, aligning with their strategy and  a view to building a portfolio.

But time and again he was being hit with the same reply:

“That’s sounds too hard – I just want to buy an investment property. Can’t you just help me buy something… anything… quickly?”

This is interesting because acquiring investments for clients is exactly what we do – but these callers don’t really want to buy an investment property… they actually want to be sold an investment property.

Here’s why I find this so disappointing and infuriating.

Imagine walking into a shop and saying, “I want to buy a mobile phone.”

The salesman says, “Here you go – a Nokia 1210 – that’ll be $200.”

You’d be up in arms! “Wait a moment! that’s out of date, too expensive and won’t do half the things I need it too. I want a smart phone with internet connection, camera and apps!”

So, it seems you don’t want just any phone. You have needs and wants from your device – but will also have a budget and probably future plans for upgrading.

It’s the same with investment property. Not every asset is a great opportunity and not all homes will suit all investors.

It makes me shake my head and wonder why someone who would care so much about their smartphone purchase, would give no thought to their property investment.

Safe investing

If you go to realestate.com, Domain or Google or talk to a real estate agent who is getting paid by the vendor to achieve the highest possible price, then you will be sold a property. If you attend a seminar or crave glossy brochures, you will be sold a property – and it won’t be in your best interests.

The problem is being compounded at the moment by the Fear Of Missing Out.

FOMO is fuelling this illogical approach to property investment. We’ve got a situation where there’s more buyers than listings – and it’s a hotbed for bad decisions and financially dangerous outcomes.

If you’re going to invest $500,000 or more, why wouldn’t you want to take the necessary steps to ensure it’s the best possible asset for your needs? Why would you be happy to buy just anything in order to get a foot in the door? Why do you want to be ‘sold’ too?

The best results come from drawing on an expert advisor who is working in your interests.

These are people who know investment success is a two-way street, where both you and they share a common goal.

These experts can apply specialist research skills to select not only locations that offer growth and rental potential, but also pinpoint properties that will fit your individual criteria for long-term investment success.

The end result will see you build a portfolio on a solid foundational strategy that can deliver excellent results and have your financial security ensured.

We all invest for one reason, to achieve a result! So focus on YOUR numbers, the data and the right professionals that specialise in this day in day out.

Always review any property location research and investment analysis data, with a professional, QPIA (PIPA Member) qualified & accredited ASPIRE Property Advisor Network Advisor. Never rely on glossy sales brochures or property marketing information, ensuring a property is right for your strategy. Property Investing is about BUYING a property that matches your goals and aligns with your investment strategy, never be SOLD an investment.

Visit www.aspirenetwork.com.au or call our office to be connected with an accredited and independent Property Investment Advisor on 1300 710 933.

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