Get a head start on property investment opportunities by preparing in advance
If you do think that you might look to purchase a property in the not-so-distant future, there are a few measures that you should consider implementing to ensure that you are able to act promptly if the right opportunity arises.
After all, it would be horrible to discover your dream home or apartment only to have it snagged from underneath you by a more swiftly prepared buyer.
Here are a few important steps that you can take to make it easier to act quickly on property investment opportunities:
1. Determine how much you can borrow
Determining your borrowing power is the first major step towards securing a property investment, because it enables you to get a general idea of your target price range, so that you can narrow your property search within your purchase budget.
The amount you can borrow will depend on a variety of factors including, but not limited to, your debt and equity levels, credit history and existing assets, as well as the property type and any rental income/s that you expect to receive from it.
Many lenders have forms that can be submitted online to help you get a general idea of your borrowing capacity, or alternatively you can approach banks directly for advice.
2. Consider your costs
Once you have arrived at a general figure for your potential purchase price, you will need to take into account other charges that will apply.
One of the biggest initial outlays will be your deposit, which is usually 10% of the purchase price. You should also allow additional funds for the loan application fee, valuation fees, taxes, stamp duty, legal costs and insurances associated with buying a property.
It is suggested that you itemise your existing and projected expenses, put together a budget, and then assess what types of properties are financially feasible for you.
3. Research Loan Options.
It is always good to get an idea of the type of financing packages that are available within the market: you should compare rates, features, fees and charges and consider which particular mortgage packages are most suitable to your needs.
This is often a complicated process, however, and it can therefore sometimes be beneficial to consult a mortgage broker, who can explain your options to you and facilitate the process with the banks to help you get the most competitive and appropriate finance solution.
4. Get loan pre-approval
You should attempt to get your loan pre-approved by the bank as it will enable you to shop within your budget and make a calculated offer on your property of choice. It will also give you a head start on other buyers that don’t have their loans pre-approved.
In addition, having your loan pre-approved might make you a more attractive purchaser to vendors, as there may be less perceived risk that the transaction won’t go through. You might even be able to secure a buying selling price through proposing a private offer, particularly if the vendor is looking to sell in a hurry.
5. Plan your ‘activation’ team
When the time comes to execute a property transaction you are likely going to need a team of professionals by your side to help get the job done, including a real estate agent, a lawyer/conveyancer and an accountant.
Given such, you should begin seeking out professionals that you can be confident will be honest, direct and reliable. By having these relationships in place before the transaction process begins, you can save yourself a great deal of time, energy and stress - allowing you to perform the remaining parts of the process without added distractions or worries.
In any case, you should only ever borrow finance within your means, and purchase if you are well-positioned to buy.
For information about available property purchase opportunities in your area, please contact your local CENTURY 21 agent, and for additional advice on prospective loan options please contact a CENTURY 21 HOME LOANS agent.