Knowing how to minimise the risks and prepare a plan of attack for ‘when’ (rather than ‘if’) obstacles encroach your investing strategy is the best way forward for investors.
However, learning directly from the property experts about some of the most common mistakes that investors make provides for an ideal diversion away from the path that is known to yield the least rewards.
As property investing coach and director of The Property Bloke, Wayne Jessup, shares, “it’s like a big funnel of opportunities in the property market so [investors] really need to be looking for what specific they need for their plan”.
In the recent interview with Your Investment Property editor Sarah Megginson, he delves into the common mistakes that he sees investors make as they navigate their way up the property climb.
Because who ever said it was a smooth, straight ladder?
“It comes down to your age, it comes down to what you need, what your income needs. All that is a big part of it. So, having some education and having a plan of attack is definitely how they’re going to be set up in 2020,” Jessup says.
One of the biggest miss-steps that Jessup has seen investors take is not getting their loans set up in the correct structure – a crucial component that will largely determine the amount of tax they will be required to pay.
“Ownership structure is very important whether you’re a first-time investor or whether you own ten properties,” Jessup says.
“It comes down to who wants the property, whether it’s you personally, whether it’s you and your [partner], a signage of ownership whether it should be a company, a property trust, all those types of structures.”
Jessup says ensuring that your property ownership structure is in the most advantageous position and discusses some of the other common mistakes to avoid along the investing journey; including not skipping on professional advice and making sure that you stay focused on your individual goals.
But with changes to lending restrictions having the potential to thin out your buying options, how can investors rise above the changed landscape?
The property coach encourages investors who are planning to add to their portfolio or purchase their first property to not delay in researching their options, including the mechanics around how to get approved for a loan.
“Lending criteria is a lot harder so therefore, we’re actually doing a lot more work on loan structures and affordability and lending sort of comparisons prior to and when they start looking for a property,” Jessup explains.
“So, when you’re actually ready to hit the market and buy a property, once you’ve done your research, done your education, you’re 100% ready to go and you don’t miss out on an ideal opportunity.”
