{"id":5632,"date":"2015-09-07T01:00:03","date_gmt":"2015-09-06T15:00:03","guid":{"rendered":"http:\/\/realestatetalk.com.au\/?p=5632"},"modified":"2015-09-07T01:00:03","modified_gmt":"2015-09-06T15:00:03","slug":"10-things-you-must-consider-when-buying-an-investment-property","status":"publish","type":"post","link":"https:\/\/channels.realty.com.au\/realtytalk\/10-things-you-must-consider-when-buying-an-investment-property\/","title":{"rendered":"10 things you must consider when buying an investment property – Michael Yardney"},"content":{"rendered":"

 
\nIn today’s show you will hear the 10 things you must consider when buying an investment property with Michael Yardney<\/strong><\/a>,\u00a0from Metropole Property Strategists.
\n <\/p>\n

Transcript:<\/h3>\n

Kevin:<\/b>\u00a0 With the property market doing so well, obviously more people are interested in getting into property. We can see that in the numbers, too, of people coming to listen to Real Estate Talk. It\u2019s always great to have new people listening to us. We\u2019re here to help you work out a plan to succeed.
\nThere are some things you should consider when buying an investment property. To walk us through the ten most important things, Michael Yardney from Metropole Property Strategists, who is a regular on our show.
\nHi, Michael. It\u2019s good to be talking to you again.
\nMichael:\u00a0 <\/b>Hi, Kevin.
\nKevin:<\/b>\u00a0 A bit of advice for new investors, Michael \u2013 the things you think they should consider?
\nMichael:<\/b>\u00a0 I think it\u2019s a good way to start, but it is also a good recap for people who are thinking of getting into the market again. I think the first step is \u201cWhy?\u201d What are you trying to achieve? Is it money? Is it wealth?
\nI think for most people, it is financial freedom. Remember, the bricks and mortar really isn\u2019t the end goal. Rather, it\u2019s the vehicle to get you to what you want to be. Therefore, treat property investment as a journey, and don\u2019t get lost along the way.
\nI guess the next step then is to understand \u201cWhat strategy are you going to put together to get you there?\u201d My preferred strategy is high growth properties. I know some people look at cash flow, but my strategy is to buy a property in one of the big capital cities that has multiple pillars of growth drivers. I look for properties below their intrinsic values in areas that are going to perform well in the long term.
\nI look for something that is a bit unique, a bit different, or special, and I like adding value. That\u2019s the sort of strategy that I suggest people consider.
\nKevin:<\/b>\u00a0 What about the type of property, Michael?
\nMichael:<\/b>\u00a0 You need to own the sort of property that\u2019s going to be in strong demand by \u2013 in my mind \u2013 owner-occupiers. Most investors think like investors, but to me an investment-grade property is an owner-occupier property, not because you\u2019re going to sell, but because owner-occupiers are going to buy similar properties around you, pushing up the value of yours.
\nOver the last years, the trend seems to be more people are trading back yards for balconies, they\u2019re going to want to live closer to the action in the inner suburban areas of our big capital cities, and many of them are in apartments and townhouses.
\nKevin:<\/b>\u00a0 What about old or new? Should that be a consideration?
\nMichael:<\/b>\u00a0 It definitely should. I like new properties, but I don\u2019t like paying a premium for them. Many new properties currently are in those large high rise monoliths, which that don\u2019t have the level of scarcity.
\nSo while I like new properties, I don\u2019t like paying a premium for them. I\u2019d rather buy an established property and add some value manufacturing some capital growth.
\nKevin:<\/b>\u00a0 Michael, how particular are you about where you buy?
\nMichael:<\/b>\u00a0 I think when you buy a property you have three things to play with. You have your price, you have location, and you have the type of property. Price is usually determined by your lender, so you haven\u2019t got much say in that. I think location is the critical one where you buy \u2013you\u2019re right, Kevin. Then, if you can buy in a good location but you can\u2019t afford a home, I\u2019d be buying an apartment.
\nSo location is going to be the difference between those properties that outperform and those that don\u2019t.
\nKevin:<\/b>\u00a0 Watch out, too. On a regular basis, I record some videos with Michael on the common mistakes investors make. Recently, Michael, we talked about the timing of the market and when you should buy.
\nMichael:<\/b>\u00a0 I think there are investment opportunities at most stages of the cycle. I\u2019ve found most successful investors<\/a> can make money at any time. Sometimes it\u2019s going against the crowd when the market is quiet, but even in these strong markets, there are opportunities.
\nThe right time to buy is when it suits your personal financial circumstances, and then what you would amend is where and what you buy. But there are\u00a0 always opportunities, Kevin.
\nKevin:<\/b>\u00a0 What about \u201cWhat I can afford, and how I should structure it?\u201d
\nMichael:<\/b>\u00a0 The first way you would do that is to go to see a proficient finance strategist \u2013 not necessarily the bank, but someone who understands how to set your finances correctly. I\u2019d always suggest you get your loan preapproved, because that is going to be one of the factors that affects where you buy and the sort of property you can buy.
\nAlso, I\u2019d be speaking to accountants about the right ownership structures, the right entities. It could be in your own name, it could be in a trust. Some people buy properties in self-managed superannuation funds, but you have to be very careful and get the right advice if you do that.
\nBut you have to do that beforehand, Kevin, because you have to get the finance in the right entity.
\nKevin:<\/b>\u00a0 Who should you ask for advice?
\nMichael:<\/b>\u00a0 I think if you\u2019re the smartest person in the room, you\u2019re in trouble. In my mind, residential real estate investment is a team sport. You need to get a good accountant \u2013 as I\u2019ve said \u2013 a smart solicitor on your side, and a good finance broker.
\nI believe in today\u2019s world when the other side \u2013 the seller \u2013 has agents or marketers on their side protecting them, you should also have an independent property strategist on your side protecting you.
\nKevin:<\/b>\u00a0 Asking about advice: not wise to get it from friends and family?
\nMichael:<\/b>\u00a0 Unless you have multi-millionaire parents, the answer is probably \u201cNo.\u201d Everyone has an opinion on real estate. Everyone thinks they know about it because they live in a home, but the simple answer is unless you\u2019re getting advice from wealthy people, I would be having fun with friends and family but not necessarily asking them for mentorship in wealth creation.
\nKevin:<\/b>\u00a0 Great advice. Michael Yardney from Metropole Property Strategists. Michael, thank you so much for your time.
\nMichael:<\/b>\u00a0 My pleasure, Kevin.<\/p>\n","protected":false},"excerpt":{"rendered":"

  In today’s show you will hear the 10 things you must consider when buying an investment property with Michael Yardney,\u00a0from Metropole Property Strategists.   Transcript: Kevin:\u00a0 With the property market doing so well, obviously more people are interested in getting into property. We can…<\/p>\n","protected":false},"author":176692471,"featured_media":5045,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[10,13,25],"tags":[101],"class_list":["post-5632","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-kevin-turner-sponsored-channels","category-latest-story","category-sponsored-channels","tag-podcast"],"yoast_head":"\n10 things you must consider when buying an investment property - Michael Yardney - Realty Talk<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/channels.realty.com.au\/realtytalk\/10-things-you-must-consider-when-buying-an-investment-property\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"10 things you must consider when buying an investment property - Michael Yardney - Realty Talk\" \/>\n<meta property=\"og:description\" content=\"  In today’s show you will hear the 10 things you must consider when buying an investment property with Michael Yardney,\u00a0from Metropole Property Strategists.   Transcript: Kevin:\u00a0 With the property market doing so well, obviously more people are interested in getting into property. 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