Home Improvements

Tips for a building a hassle free property portfolio

Most people want to get old and not have to work till the day they die. It’s a very obvious and natural desire and we are programmed from an early age to start saving and planning for our retirement. But the truth is that retirement planning is a long term thing, something that generally means that by the time you are too old to work that you have scraped enough together to live out your days. And that is not an ideal scenario. So if that isn’t the best option what other angles are there that can see you provided for in your old age? The answer is simple – property. And here is why.

It can be very easy

You need to find opportunities that can work for you, rather than jobs where you have to do the work. A rental generating portfolio of properties is exactly that, but even so, you need to make sure that it is not too much work. Ideally once you have bought a place you should look to work with a company who look after your tenants and your asset. Companies offering property management Collingwood or any other city or suburb can be found in the local phone book or online and they have the ability to make your investment, and your returns a painless process.

 

Minimize risk

Just because you qualify for a bond doesn’t mean you should spend it all in one place. Remember that the bigger the rental you get from a single property, the more exposed you are in the event that your tenant defaults on a payment. Rather buy five cheaper properties than one expensive place to ensure that you manage your risk. After all, when investing it is never a good idea to have all your eggs in a single basket.

 

It is not about you

Remember that when you buying places to rent you are not buying them for you to live in. This applies particularly if you are investing in the lower-income housing market, where there are often bargains to be found. The apartments might not look great when you view them, but remember that to your prospective tenant they might be the answer to a prayer.

 

Research

Typically speaking when you are buying to rent you are not looking for long term capital value increases, you are looking for monthly income. But there is no harm in getting both. So do your research and do it well. Know the areas that you are buying in and understand the market. There is no point in buying a place to rent if there is no demand for rentals in the area. If your long-term goal is to have twenty apartments that are all mortgage free and earning rental, then you need to do the research at the beginning of the process, because once the mortgages are paid off ten years or so down the line you will be in big trouble if your retirement plan has become a white elephant.

Comments are closed.