Low interest rates and rapidly rising property prices are driving investors to property investment. Many would-be property investors don't understand the complexities involved and can easily make costly mistakes. Here are some basic principles to follow.
Understand that property investing is a business. It requires planning, discipline, a wide range of knowledge, willingness to take calculated risks, and a focus on getting a good return on your investment.
There is no room for emotion in property investment.
Develop your strategy. There are many different approaches to property investment with different financial outcomes. You might choose to:
- Buy property to retain for the long term, buy to renovate and sell, buy to renovate and retain, or be a property developer.
- Specialise in certain types of property, such as apartments, properties with multiple tenancies, coastal properties, or low cost housing.
- Specialise in a particular geographic area.