There are three points at which a savvy investor makes money on an investment property: buying, renting and selling. We’ve all heard the adage, “buy low and sell high.” It is important to maximise your income at every step along the way to maximise your success as an investor. Here are five tips for making money on the “front end.”
Keep a Vigilant Eye on the Market
If you want to truly make the most of property investing, you must make it your business. It must be important to you and you must always be on the lookout for opportunity. Keeping an eye on the market makes bargains happen almost on “autopilot.” It can tell you when a house is underpriced; it can also tell you when a house has been on the market too long and the seller may be motivated to sell for less.
A price that has remained steady usually indicates a stubborn seller, while one that has been decreasing on a regular basis means the seller is more likely to come down even further for a bona fide offer.
Search Mortgage Sale, Deceased Estates and Public Trustee Websites
While some may feel uneasy and like they are swooping in like vultures when they buy property from someone who has just died or lost their mortgage, you are actually doing the family that owns the house a huge favour. If you have access to money fairly fast, you can find a lot of severely underpriced properties this way.
Does It Have Renovation Potential?
It is no accident that there are now plenty of renovation programs on cable TV—renovation is a great way to add to the revenue a property produces. Simple renos such as installing a modern kitchen, painting the walls and replacing the carpets can improve an underpriced home’s value considerably.
Does It Have Development Potential?
Recent zoning changes have made it possible to subdivide and develop properties that weren’t eligible before.
Ask the Correct Questions
Open-ended questions that get the seller or the seller’s agent providing information can be profitable, such as “why are they selling the property?”
Bonus Tip
At Investors Edge, our experts make this entire process easier with their market knowledge. Call 1300 472 427.
