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While having enough money set aside as a deposit is one of the greatest challenges for investors, research has revealed that finding the right location trumps this concern.
Mortgage Choice’s 2013 Property Investors Survey has found that 38.7 per cent of respondents were finding the locating of a good investment to be the main concern, while 26.9 per cent cited saving a deposit as a the biggest challenge.
In third place, 17.3 per cent of new investors selected ‘Choosing the investment strategy’, while choosing the right loan, sourcing quality advice and getting finance approved came in the last three places, at 6.5, 5.5 and 5.2 per cent respectively.
However, when looking solely at new investors, these results alter significantly.
The greatest hurdle for first-time investors is saving a deposit, with 42 per cent selecting this option.
“Finding the right property is half the challenge for most investors; the other half is saving the deposit and settling on an investment strategy that will help them to achieve their goals,” Mortgage Choice’s head of corporate affairs, Belinda Williamson, said.
Ms Williamson noted that a majority of new investors would need to be willing to understand the size of the financial commitment, and said that a vast majority are choosing to make cuts in their own lives to fund their investments.
“Our survey shows 75 per cent of Gen Y first-time investors are choosing to make lifestyle sacrifices to help them achieve their property goals. The top five lifestyle sacrifices included cutting back on general day-to-day spending, eating out less and limiting take-away food, missing out on a holiday, delaying a vehicle purchase and last but not least, cutting back on alcohol related expenses,” Ms Williamson said.