It’s a great time to be a property investor with CoreLogic’s latest quarterly rental review finding national rent values soared 10.2% during the 2022 calendar year. This uplift means rents are now up by a stunning 22.2% since they began their most recent upswing in September 2020 – a new record.
But while property investment can be a fantastic way to achieve financial independence, not every investor is successful. So how do you avoid the common pitfalls and make your dream of building wealth through property a reality?
Here are six key steps to becoming a successful property investor this year.
1. Make sure you’re in a sound financial position
You don’t want to be forced to sell your investment property. So check your finances and make sure you can afford to meet your loan repayments, adding a healthy buffer to cover any unforeseen expenses or emergencies.
2. Get clear on your investment strategy
Failing to plan is planning to fail. So make sure you know exactly what you are trying to achieve as an investor. By having an end destination in mind, you can map out the steps you need to take to get you there.
3. Do your homework
There’s no escaping the importance of location when it comes to real estate. Develop your market knowledge so you can find quality properties in areas with strong economic and population growth.
4. Have the right mindset
As with all forms of investing, it pays to think long-term. So ignore the short-term noise and negative media chatter, and rather focus your efforts on buying the right property at the right price and then holding onto it for as long as possible.
5. Surround yourself with a great team
Successful investors know that property investment is a team game, so don’t be afraid to seek out expert advice.
6. Don’t follow the crowd
It’s natural to assume that the current downswing means it’s best to hold off buying an investment property until things improve. But a softening market can be a great time to begin your investment journey (if your financial circumstances allow) as buyers largely have the upper hand.
As Warren Buffett famously advised: be fearful when others are greedy, and greedy when others are fearful.