Let's be honest, we all can at times be guilty of rushing into things; one because our emotions kick in and take over and two because we are human and we are impatient and need to have it right this instant! Even though purchasing a property is one of the biggest financial transactions we will ever make, it often falls into the category of "I need this right now" and we forget to do our homework and properly research the market, location and of course the property itself.
Thanks to the explosion of available information online, doing your research these days has become so much easier. Everything is available at your fingertips. Property data is now readily accessible online for free via hundreds websites. But with so many websites and people throwing their opinion at you, the once simple task of doing a little bit of homework on your dream property can now seem daunting and a job that's just too big to attack.
Where to start
Cutting corners with your research is guaranteed to get you into serious trouble, note this down and make sure you remember this quote next time you're researching!
This is especially true in hot markets like The Central Coast, where buyers are falling over each other to nab a property. No matter how "good" a property looks on the surface, you can't and won't know the full picture until you start digging deeper.
You need to know whether the property is a good deal or not and you can only make this call if you know all the information about the property. Kyle Brand says, "At George Brand Real Estate we often suggest the "benchmarking" strategy to our clients to help them compare properties against one another. Start with writing down all the features of property number 1 then bring this along to property number 2 and compare features. One of the properties will rise above the other and the other gets eliminated. The process gets continued until you find the perfect home that ticks all the boxes."
You also need to establish if this type of property is in good demand for the suburb. How much will it rent for? Who will rent it? Will it sell down the track should you want to put it on the market? Failing to do all this upfront research will ultimately lead to you buying an under performing property at best and a money-losing investment at worst.
Research doesn't have to be a lengthy process, but you need a clear idea of what makes for a good investment property. Creating your investment criteria and going through each checklist when assessing a property will ensure you're covering all the bases.
Is too much research too much?
The flipside of doing too little research is doing too much! Although it may sound like a contradiction, too much research can sometimes have a negative effect as it can leave you unable to come to a result and make a decision.
Don't get me wrong, you want to thoroughly research the property but becoming overwhelmed by too much information only creates confusion and frustration. Staying focused and sticking to your checklist will ensure you only move forward with confidence.
Without structured research, you could be spending too much of your time fluffing about researching unnecessary things and by the time you're finished the property has already been snapped up by a more decisive buyer. By all means do the research, but ensure that you take action as soon as you're satisfied with your numbers.
As you can see, there's really no substitute for doing your research. If you want to succeed as a property investor, be prepared to put in the hours conducting your research and following your checklist and sticking to it! This will give you the highest chance possible to secure that dream home you have your eye on.
SOURCE – Based on article from realestate.com.au