When it’s done right, investing in property can help you to build wealth for your future. In Australia, property is currently a very popular investment and many people are enthusiastically jumping into the market to make the most of the low interest rates currently available. But it takes careful planning for your property investment to be a success. Here are ten key factors to consider before investing in property.

1. What you want to achieve
First, determine what your end goal is – it might be financial freedom, to tie up some extra funds, or to live in the property yourself in years to come – and then make a plan that’ll help you reach that goal in a suitable timeframe. Review your plan on a regular basis to make sure you’re on track.

2. Your preferred investment strategy
If you’re looking to maximise returns, wise investors focus on buying a property below its intrinsic value in an area with a long history of strong capital growth. Also look for a property that’s unique, special or different, and one that you can renovate or redevelop in order to produce better capital growth.

3. The type of property
A good investment is a property that’ll be in continuous strong demand from both tenants and owner-occupiers. This is because tenants help pay off your mortgage, whereas owner-occupiers push up house prices. More people nowadays trade their backyards for balconies, so think about going for an apartment-style property in the inner suburbs.

4. Buying old or new
Remember, you’ll often miss out on capital growth for the first few years if you buy a new or ‘off-the-plan’ apartment. This is because you’ll have to pay a premium to the developer.

Another thing to consider in purchasing a new unit as an investment property, is that many owners in the building will most likely be investors also. It’s best to buy an apartment in a building predominated by owner-occupiers, as they typically look after the building more effectively than investors. The established apartment should also be in a character-filled block that can be cosmetically refurbished, as this can help you increase your rental income and produce some capital growth.

5. Where to buy
Location is very important when it comes to your investment’s long-term performance, so look for a property in a suburb that has always outperformed the averages or one that’s being renovated or redeveloped. You’ll usually find it in a lifestyle suburb in a major capital city near the CBD, amenities or water. Then narrow your choices further by choosing the best spots in the suburb.

6. What you can afford
You should know how much you can afford to spend and repay before you look for a property. You can do this by talking to us about getting a pre-approved loan and setting aside some funds for acquisition and holding costs, as well as a financial buffer for an emergency or a rise in interest rates.

7. Who to ask for help
In addition to us – your professional finance broker – you’ll need expert input and advice from the following people: qualified accountant, independent property strategist, smart solicitor, and if at all possible, an experienced property investor as a mentor. They can all help you ensure that your investment is a success.

8. The importance of research
Successful property investors never stop researching the market to capitalise on the best opportunities. You should familiarise yourself with all Australia’s various property markets and not just your local market, in order to find the best potential for profit.

If you’re looking to invest for the first time or expand your existing property portfolio, or to venture into investment for the first time, contact us today. We’ll help you with your finance and give you referrals to professionals who can help you with the purchasing process.

There are around 21,000 new businesses founded each year in Australia. And with a little over 2 million actively trading businesses country-wide in June 2014, there are plenty of good reasons to run your own small business. We often get approached by self-employed clients and prospects enquiring about their home loan opportunities. And whilst many banks have tightened their credit policies when it comes to the self-employed, with the right help, there are still plenty of options available. What are some things you need to consider as a self-employed borrower? Know your numbers Your self-employed status does not have to impact negatively on your borrowing potential, although the amount of information you can supply will ultimately decide which products are available to you. Lenders calculate how much they are willing to lend using a combination of your credit score, salary (income) records, and their affordability calculations. If you are self-employed, your overall income and financial situation may be more complicated, so it is important to establish a solid track record of low expenses and high income. Build a good record Requirements vary depending on the lender but, generally, self-employed borrowers will need both to have been in business and to have held an ABN for at least two years. On top of the usual loan application documentation, lenders may also require you to produce BAS statements, tax returns, bank accounts and perhaps a declaration from your accountant. Being concise and providing correct and accurate information to the lender will increase your chances of a positive outcome. Do your taxes and reduce debt Keep your taxes up to date so you can always show your most recent income history. And make sure the tax assessments are paid. Self-employed applicants are more likely to have their tax portals checked for anything outstanding. It’s also a good idea to eliminate or reduce your other (personal) debt. Lenders don’t just look at the balance, even if its zero – they count the limits on your credit cards and assess them as risk or funds you owe! Understand your options The good news is that lenders do have loans for self-employed people, contractors and business owners. In theory, self-employed borrowers have access to exactly the same range of mortgage products as everyone else, so long as you are able to put down the necessary deposit and substantiate your income you have a good chance of getting an advantageous rate. One option to consider is a Low Documentation (Low Doc) Home Loan. These are designed for self-employed customers and small business owners who may not have access to the financial statements and tax returns usually required when applying for a home loan. ‘’Low doc’’ simply means alternative forms of income confirmation (bank statements, financial statements etc) as opposed to PAYG slips and tax returns. With tax returns, we can also help you pursue a full documentation loan at standard rates. Have a strategy We recommend you consult with us, your mortgage broker, to formulate a plan for securing your loan well before buying your property. This allows you to build your serviceability based on expert advice and years of experience. If you are self-employed, or know someone who is, and would like to learn more about your options, please get in touch with us on the details below.