5 Key Property Investment Tips and Tricks

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By Lateral Partners

29-06-2022

We've been through the property investment process ourselves here at Lateral, and we've learnt a few things along the way. Here are our 5 key property investment tips.

Don’t get emotional about a property

Think about your investment property as a business. Just like any investment, you are in it to make a profit. Separate any emotions or feelings, and make it purely transactional. Using property managers and other advisors will help with making ‘business like’ decisions.

Understand the power of leverage

Leverage is your biggest tool in property investment. Make sure you understand the principles of leverage, and how you can use it to your favour and maximise your leverage position with the banks. Learn more about this in our free Property Investment Guide.

Get a recent valuation on current owned properties to unlock usable equity

If you see house prices have risen and want to check how much potential equity is in your property, then you can order a new valuation. Your broker should be able to provide you with an electronic valuation for free, or you can choose to pay for a registered valuation. Your usable equity will be the value of the property minus the debt owing, and the equity that the bank requires you to keep in the property.

Factor in unexpected costs

Always make sure you are financially prepared for unexpected costs by having a ‘rainy day’ fund. This means you won’t get caught out if your property needs some sudden maintenance, or becomes vacant for an extended period. When budgeting, you should always assume your property will be vacant for a few weeks a year and that there will be maintenance costs to pay.

Use a revolving credit on your owner-occupied home

Using a revolving credit facility on a portion of your owner-occupied home loan may allow you to reduce the monthly interest you pay on your home loan which may then allow you to have readily available cash to help increase your equity position. There are risks associated with this type of facility and It requires a high level of account conduct and management.

If you want to learn more about the Property Investment process, download our free Property Investment Guide here.

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