One of the common mistakes new investors make is assuming that the investment stops at the loan – having your loan structured correctly is only the first step. Being a landlord comes with a barrage of responsibility and doing your due diligence, this includes:
- Having money aside for repairs and maintenance
- Knowing when to increase rent
- Having a property fully inspected and up to standards
- Understanding your legal responsibilities as a landlord
- Having insurance to cover any damages or loss that may occur
When building your portfolio, it is important to do your research into the areas you are intending to buy into. It can be easy to simply buy into the current popular suburbs but properties in high-demand locations can often cost a lot more which could mean the returns are not that huge. Researching into up-and-coming suburbs and educating yourself on the cities shifting landscape could pay off in the long term – buying a cheaper property in a growing suburb could pay off well in five years, its called an investment for a reason.
When looking into growing your portfolio with additional properties, variety is an essential tool in having security and options in an ever-fluctuating market. Diversifying your portfolio with an assortment of property types such as apartments, units, and houses as well as different locations can help keep returns steady while watching new potentials grow.
Having a mentor or an expert on the local area and trends can prove to be a valuable asset. Accountants and financial advisors with experience in investment property can stop you from making similar mistakes many gung-ho investors make early on.
PFSL offers an umbrella of services such as mortgage brokers, insurance, accounting and tax services, and property managers all under one roof to keep the whole process as smooth as possible.