Feeling snowed under by the amount of property statistics and data out there? Never fear. We show you how to overcome what's largely known as "analysis paralysis" and find your property investor legs
Right! This is it. Time to buy an investment property. I'm really going to do it. I'll just get the quarterly sales figures for these 30 suburbs. Better make that 50 suburbs. Hang on, there are some hot spots up north. I'll check those out as well. Mustn't forget the yield figures, vacancy rates, city-wide infrastructure reports, planning codes, crime stats... This is going to take a while; I'd better get a cup of tea.
Six months pass, 12 months pass, investment opportunities flit by and you're still no closer to making a decision. The experts agree: you've got analysis paralysis.
"It's when people make the mistake of thinking that they can do their research wholly and solely sitting behind a computer, strapped into their ergonomic chair, without physically going out into the property market and observing what actually goes on," says Monique Wakelin, head of research, analysis and communications at Wakelin Property Advisory. "There is a place for looking at median values and looking at trends and looking at the way different precincts evolve over time, but that can't happen to the exclusion of actually pounding the pavement on a regular basis."
Rob Williams, who amassed a $2m, seven-property portfolio in under two years, says, "I think a lot of people go out of their way to look for too much information and get too many facts and figures. Perhaps they're trying to avoid making a decision or they're trying to look for more validation. Either way, it tends to result in that analysis paralysis and they tend not to do anything. That happens to a lot of people."
Williams was runner-up in last year's Your Investment Property Investor of the Year awards. He says there is no substitute for actually going to the location of a property yourself. "You can crunch all your numbers and get a pretty good idea but eventually you have to get on the ground and have a look," he says. "Does the local school look run down? What are the local facilities like? It's all very well to say there are restaurants and cafes around, but are they thriving or are they about to go under?"
Helen Collier-Kogtevs, director of Real Wealth Australia, acknowledges that highly experienced investors might get away with buying sight unseen, but for most of us, that would be very unwise. "You must always, always, always go and have a look at the property you're looking to buy," she says. "Drive around the area, have a coffee, talk to the locals."
First things first
Before you jump onto a real estate website and start typing in suburbs at random, stop and think. What is it, exactly, you want to achieve? Identifying what you want to achieve helps keep you focused. A budget helps you work out how much you can really afford to spend each week out of your income to put towards investing.
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