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Investing in property is a proven way for Australians to build your financial nest egg.
But if you’re apprehensive at the thought of taking that leap and borrowing six-figures (or more) to invest in property, you’re not alone.
Here are six of the most common fears that trick people into not investing:
1. Fear or failure
If you don’t have previous experience, it’s easy to feel like investing is something you’ll never be able to achieve, and it’s true it can invite some potential disasters.
Loss in property value, inability to keep up with maintenance, the prospect of terrible tenants, and all the stress that comes with owning a property is enough to deter even the most savvy of would-be landlords.
But by having a “rainy day” financial buffer, researching your properly carefully before you decide and by getting a team of independent and unbiased advisers around you, you’ll minimise the risks for potential failure – and maximise your chances of success.
2. Fear of being swindled
The property market can be rife with mixed information, which makes it easy to feel distrustful of those who “appear” to be there to help.
Many so called “advisers” have a vested interest, while real estate agents represent the vendor and project marketers…well enough said!
Healthy scepticism can actually be valuable, because it allows you to think twice before diving into what could potentially be a poor choice.
Trust your instincts, and if it doesn’t feel right, don’t do it.
But don’t let your fear of losing money prevent you from investing at all – because if you don’t buy any assets, you’ll never grow your wealth.
3. Fear of being inexperienced or unintelligent
Investing can seem so overwhelming that it might feel easier to avoid it all together.
But the truth is, if you approach it with an open mind, anyone can understand it.
There are many sources, from books and magazines to online blogs, which can help you to build your knowledge before investing.
What’s more, you don’t need to understand every single aspect of it to make an effective choice.
And if it’s still too much, you can enlist the help of a professional, like a property strategist, to make the process easier and give you the best chance of choosing a quality properly and making wise investment decisions.
In fact to secure your financial future in today’s “intersting” environment, you’ll need much more than just a property strategist or a buyer’s agent.
The team at Metropole offers a 360° holistic approach to ensure you Grow, Protect and Pass On your wealth.
We customise a solution to meet your specific needs through a time-tested 360° system for acquiring wealth and help beginning investors buy their first property, experienced investors add to their portfolio and sophisticated investors manufacture capital growth by becoming property developers.
4. Fear of fudging the numbers
Investing involves numbers, and lots of them.
If maths isn’t your strong point, you might shudder to think that in order to invest properly in property, you must have at least a basic idea of mathematics.
You need to be able to estimate a property’s potential cash flow by calculating aspects such as the expected rental income, necessary repairs and maintenance, insurance, taxes, and payment for any expert advice you’ve received along the way.
But never fear: if all of this falls into your ‘too hard basket’, you can always work with trusted accountants and advisors to guide you on your way.
5. Fear of going broke
Put simply, investing in property means taking a risk that you could lose money.
It’s a fact, and the outcome of your investment cannot be predicted with complete accuracy.
Suburbs rise and fall in popularity; future developments in the area can make a property less desirable to tenants; a property can decline in value due to a number of reasons; and the economy is forever fluctuating.
The risk of losing money is an unavoidable reality of investing, but it is a low-risk, and one you can combat by choosing your investment wisely, and buying an investment grade property in a location that is likely to outperform the averages because of its local demographics.
6. Fear of making the wrong choice
No one wants to part with a large amount of money to end up with a poor result, which is exactly what can happen if the property isn’t chosen carefully.
So how do you make the right choice among so many options?
Do your research beforehand to gauge what types of properties are likely to be in continuous strong demand in the future by a wide demographic who can afford to and will be prepared to pay a premium to live in that area.
While most inexperienced investors start by looking for a property and then doing their research backwards from there, strategic investors look for the right location first.
They recognise that the location of their property
The ability to work, live and play all within 20 minutes’ reach is the new gold standard for urban planning.
Imagine being able to carry out your daily activities within a 20-minute walk from home.
All the things you need in a day would be just a short walk away.
In planning circles, it’s a concept known as the 20-minute neighbourhood, and it could be on the cards for your area sooner than you think.
And it’s likely than in our new “Covid Normal” world, people will love the thought that most of the things needed for a good life could be within a 20-minute public transport trip, bike ride or walk from home.
Things such as shopping, business services, education, community facilities, recreational and sporting resources, and some jobs.
Ultimately, we all face similar fears when it comes to investing in property – and in fact, it would be unusual if we didn’t have fears of some sort.
The key to moving past your fears is to do what you can to mitigate them, so they don’t stand in your way and prevent you from building your wealth through property.
Now is the time to take action and set yourself for the opportunities that will present themselves in property this year.
If you’re wondering how to take advantage of the new property cycle you can trust the team at Metropole to provide you with direction, guidance and results.
Whether you are a beginner or a seasoned property investor, we would love to help you formulate an investment strategy or do a review of your existing portfolio, and help you take your property investment to the next level.
In “interesting” times like we are currently experiencing you need an advisor who takes a holistic approach to your wealth creation and that’s what you exactly what you get from the multi award winning team at Metropole.
If you’re looking at buying your next home or investment property here’s 4 ways we can help you:
- Strategic property advice. – Allow us to build a Strategic Property Plan for you and your family. Planning is bringing the future into the present so you can do something about it now! This will give you direction, results and more certainty. Click here to learn more
- Buyer’s agency – As Australia’s most trusted buyers’ agents we’ve been involved in over $3.5 Billion worth of transactions creating wealth for our clients and we can do the same for you. Our on the ground teams in Melbourne, Sydney and Brisbane bring you years of experience and perspective – that’s something money just can’t buy. We’ll help you find your next home or an investment grade property. Click here to learn how we can help you.
- Wealth Advisory – We can provide you with strategic tailored financial planning and wealth advice. Click here to learn more about we can help you.
- Property Management – Our stress free property management services help you maximise your property returns. Click here to find out why our clients enjoy a vacancy rate considerably below the market average, our tenants stay an average of 3 years and our properties lease 10 days faster than the market average.
- How to overcome the biggest investment fears of many beginning property investors
- Is it time to be fearful or greedy in property?
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