We wanted to go through some ‘myths’ and “realities” people have about building investment property portfolios. These stop people from progressing with their financial futures.
Myth #1: Choose Property First and Think of Finance Later
For every time we had a dollar where people said – “where should I buy my investment property?” well before they even thought of the strategy aspect – both finance & investment selection.
This alone stops people from moving forward beyond the first investment property. That’s because they aren’t thinking for the long term. They don’t have a ‘step by step’ strategy laid out to enable this first property and beyond.
Remember the Australian Taxation Office (ATO) 2015-2016 stats released in April 2018 that we shared, revealed 71% of all property investors (2 million) own only 1 investment property.
That’s because that’s they are never thinking about strategy. And it’s not their fault. No one has shown them step by step to build out a strong property portfolio.
Myth #2: I can go to any bank and build my investment property portfolio
There is a myth that all banks are equal and the only differentiating factor is the interest rate. WRONG :). Different banks have different niches.
- How much equity can you pull from your existing property?
- What about valuation shopping? For example, we just ordered 4 valuations for a client’s property – which ranged from $740k to $770k! This could mean usable equity ranging from $33k to $57k!!
- Will your existing lender allow you to pull maximum equity to move forward with your portfolio?
- Are you choosing the most flexible finance set up to pay off your home AND build a property portfolio?
- How should you structure your home finance versus investment property finance?
- Are you managing risk well while you progress?
- Can you purchase 1 investment or 2 or 3 or more with your current resources?
ALL This is STRATEGY!
A tailored ‘step by step’ strategy with actionable steps helps you maximise YOUR potential – whether that’s 1 property, or 2 or 3 or 5 – you need to get this mapped out upfront.
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