Investors know they shouldn't rush into a property purchase, but being too careful and too rigid could prevent you from finding the perfect property for your portfolio.
Blogger: Marie Mortimer, managing director, loans.com.au
‘Don’t rush in’ has long been the mantra of successful property buyers. These are the ones who have found their perfect property in the right location, at the right price, and the right time. But what if the magic isn’t happening for you? What if you’ve been so careful not to rush in that you’re stuck in real estate Groundhog Day? What a demoralising place to be; every Saturday morning at open house inspections.
Competition in national property markets is fierce, particularly in the hotspots of Sydney and Melbourne, and, increasingly, Brisbane and Perth. These areas are swarming with agile investors and hungry buyers who’ve done their due diligence and have their finance pre-approved. The other state capitals are catching up by degrees and coastal strips, which slumped in recent years, are recovering steadily. The upshot is, the property market isn’t looking like becoming any more accessible any time soon.
With interest rates at record lows, it could be time to revisit your new home dream sheet. Are there possibilities for compromise you haven’t considered?
The first step in reviewing your position is to list your priorities. These are the elements you hold as non-negotiable. If you are planning to buy the home with your partner, compare your priorities and communicate as openly as possible. Do any points conflict? For example, does your list include ‘walking distance to the train’, while your partner has listed ‘secluded neighbourhood’? Perhaps your partner has listed ‘low-maintenance yard’, while you said ‘room for a pool’. Obviously, these are extreme examples and, ideally, you’d have settled on these points before you started looking for a new home. But in case you didn’t, these lists could be a big stumbling block to finding a property that suits you both.
Look now at the points on your list that are the same. These are true non-negotiable features of your new property. Everything else should be viewed as nice to have, but not essential. Any point of compromise you can agree on will expand your search potential and open up a whole range of new properties for you to consider.
Are there things that you could live with for now and change later? You might want modern bathrooms in the house, but maybe it’s worth moving in and living with the current older bathrooms and renovating to your taste later. That way you are getting exactly what you want, just not immediately.
If a specific location is what you need, ask yourself why you are being so specific. For my first home, my husband and I had a circle drawn around the CBD and we wouldn’t even look at a suburb outside of the circle. After months of looking, we decided to broaden our search to the suburb next to our target suburb. That weekend we found our perfect home and put an offer on it. Looking at your requirements and adjusting them slightly could be the difference between finding your new home, or not.