A Lending Boom Is Coming Are You Ready?
Tick, tick, BOOM! How to prepare for the lending explosion
After a lot of bad news over the past 12 months – thanks a lot COVID-19 – it’s nice to be able to kick off 2021 with some good news. There’s going to be a lending boom which, if you have your property investment strategy in place, is going to make your life a whole lot easier so you can build your property portfolio faster and cheaper.
WHY IS LENDING SO IMPORTANT TO PROPERTY INVESTORS?
Most property investors need to borrow money to be able to invest. High-interest rates can make borrowing cash an expensive thing to do.
But with interest-rates at a record low, and predictions keeping them there for the next few years, suddenly investing in property is more accessible to more people.
WHY IS PROPERTY THE RIGHT HOME FOR MY CASH?
Once upon a time, high deposit rates meant our grandparents could bank their savings and watch the dollar amount go up and up. Those fairy tales died out years ago. Deposit rates are woeful now and having your cash sitting in a bank is pretty worthless.
The property market is a better place for your cash because, when done right, it can generate an income. The more properties, the more income, the better off you are.
BORROW AND BUY – BUT BUY THE RIGHT PROPERTY!
Combined with the lending boom we’re currently in, we also have a supply issue in real estate. Partly due to foreign investment being cut, and repercussions of COVID-19, there is a lack of new builds available.
The danger in this is that with cash being cheap to borrow and lending being a new opportunity for many, people are subject to panic. They don’t want to miss out on the lending boom, so they buy an over-priced property that doesn’t have the liveability factor, the walk score, or the Third Space it needs to be an income generating investment.
In short, don’t just buy anything. The rules of property investment still apply. Buy property close to burgeoning infrastructure, good job opportunities and industry. Buy a property in an area with desirable liveability factors, such as green space and social areas. Buy a style of property that is in demand in the area and buy good quality property that’s been constructed by a developer and builder with good credentials.
GET READY AND GO FOR IT
While we expect to see low interest-rates for some years, the property market is an ever-changing, fluid thing, and things can shift quickly. Don’t just watch this space, get yourself ready to act. Seek out property investing experts, start researching what areas are booming, get your numbers in line and be ready to buy good property and hold it for a long time. This is the time to act and not look back in three to five years and wish you’d bought into the market when you could afford to borrow the cash to do it.
HOW TO ESTABLISH A CLEAR STRATEGY
Talk to the experts at Positive Real Estate, who together have decades of experience, about how to borrow and buy in the current market.
Sign up for one of our information and education events, where you’ll be equipped with the tools, resources and support to thrive, and not fall behind on your path to financial freedom – whatever that may look like for you.
Book your spot now and find out what you need to know about the current market landscape and how you can make it work for the ultimate wealth creation opportunities.
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While long term we know that cash flow is dependent on a good rental income, capital growth is the quickest way our property can pay us back. This comes down to having some smart tactics to get the most out of every dollar of value in our investment properties – something we like to call equity lock.
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Deciding on the right loan structure as a property investor, is a little bit like choosing the right outfit on a first date. It depends on what stage of life you’re at! If you’re new to the game, something a little daring might work best. Later on, you might want to play it safe. It’s the same for property investment and the stage you’re at reflecting how risky or safe your loan structure needs to be. Here we weigh up the pros and cons of principle and interest loans vs interest only loans for property investors.
Rules are an important part of life. And rules in most cases, are really just another word for common sense. They give us a clear framework around many important aspects of life, so it’s no surprise when it comes to selling your investment property, there’s a number of rules you need to follow in order to get the best result.
If you want to know when to sell an investment property, or even if selling an investment property is a good idea, all you have to do is read the rules.
Most of us were raised with the idea that debt is bad. Debt drags you down. Rich people are never in debt.
While that may have been true for our great grandparents, it’s no longer the case. Debt is one of the keys that can unlock future wealth as a property investor. The more good debt you have, the more income you can create.
But, before you go out and put yourself $1 million in the hole, let’s talk about the right kinds of debt. The debt that’s going to lead to success, not ruin. This is called…
I’m sure you’ve heard – data is the new currency. It’s the next big thing for business and it will be a catalyst for driving the world forward over the next few years. Learning how to harness the power of data in property investing, will be a secret weapon all investors can use to create more wealth. So, what is data? It’s information, insights and predictions that property investors can use to help them make smart property purchases.
Like a fine wine, the value of property gets better over time. Traditionally, the more time you have an investment property, the higher the value will rise.
However, unlike your favourite Shiraz, property values can go up and down, and up again.
Getting to know how, why and who is valuing your property can help us understand what property to invest in.
There are three ways to value a property – and three very different people doing the valuing.
What are your Big Rocks this year? What are your Big Rocks for your property investing journey?
If you’re scratching your head and wondering if you’ve accidentally stumbled across a blog for construction workers, bear with me.
Big Rocks is a concept often used in business or life coaching to essentially describe your priorities. The theory is, if you don’t have clear priorities, or if you have too many, chances are you’ll let smaller issues distract you and ultimately fail in your goals.
Historically real estate has always been a good place to put your cash. It’s an asset you can feel and touch – unlike stocks or shares – which makes investors feel safe. And, in the right place and time, property can grow in value while you sleep, meaning as an investor you don’t have to do much to increase your personal wealth. But as investors, how can we better predict the next hot spots for real estate investment so we can get in at the right price? How do we know the best places to buy that are guaranteed to grow in capital value, return regular rent increases and ensure future personal wealth?
According to the Australian Bureau of Statistics, 99 per cent of property investors in Australia fail. In this instance, the definition of failure is failing to buy three or more properties. Failure is easy. It takes very little effort to be bad at something. Success is something you have to work for, something that takes time and effort. But if you’re willing to put in the hard yards, we know you can succeed. We know because we’ve helped thousands of Australians buy property that’s yielded millions of dollars of income. To understand how to succeed, we need to know why so many fail. People fail because …