I am often astounded with how little time people spend on buying a property, whether it is their home or for investment. Many people spend more time purchasing a new car, even though a property can be 20 or 30 times more valuable!
Purchasing property should be a process instead of a short-lived event, so it demands a holistic approach. Skipping crucial stages such as strategy, research, due diligence or planning can result in long-lasting negative effects. Conversely negotiating and purchasing the right property as well as correctly managing it can make a huge difference over the long term.
Here is a look at each stage of Capital 360’s award winning 8-step process.
Step 1 - Initial Property Investment Strategy
Review your specific situation and property investment goals to develop an overall property investment strategy blueprint and an action-oriented plan to help you realise your short, medium and long term goals.
Step 2 - Structure Strategy
Liaise with an asset/property investment structuring specialist to help determine and implement the most appropriate property buying and management structure to build your property investment portfolio.
Step 3 - Property Finance Strategy
Liaise with a property investment finance specialist to help evaluate your property finance options and help secure the finance you need to execute your property investment strategy.
Step 4 - Buying Strategy
Develop a property acquisition brief, focusing on the assets which will help you build real wealth that will outperform the market. It is crucial to buy properties with high capital growth, as this will create property wealth in the long term. Using a professional Buyers’ Agent who not only specialises in building large property portfolios but has one themselves will help you to achieve this. You can also utilise their countless hours of experience in researching, sourcing, negotiating and securing property.
See how Capital 360 clients have outperformed the Australian market by 5.1%p.a. HERE.
Step 5 - Add Value Strategy (Property Renovation and Development)
Always begin with the end in mind, identifying opportunities to add value before you purchase. A detailed due diligence gives you upfront profit estimates which should be considered first to avoid spending too much and overcapitalising after the property is bought.
Step 6 - Property Management Strategy
Identify the most appropriate property managers for your investment properties and monitor their performance frequently. Look for a specialist firm that focuses on portfolio property management and have all your properties managed by the one organisation to save time and stress.
Step 7 - Property Portfolio Review
Review the performance of each of the properties in your property investment portfolio and tweak them frequently. This may include new property portfolio additions, disposals, refinancing, depreciation schedules, rent reviews, calculation of re-allocation of capital and associated costs in doing so, and the list goes on. A recent review for a new Capital 360 client gained them a $50 increase per week over market appraisals by other property managers and was leased within 1 week post settlement.
Step 8 - Property Disposal Strategy (Selling Property)
Should you choose to sell a property, then you will need to identify the most appropriate real estate agent, agency, method and timing. It is important that you understand your options before selling. If unsure you should seek objective advice from your advisers including your accountant, buyers agents and property adviser.
Adhering to these steps will ensure that you get the most of out of your property portfolio now and into the future.
Capital 360 can assist you across our award winning 8-step process, which covers in detail what you have just read.