We recently spoke with 10 investors with portfolios of 5 or more properties to explore what successful investors are doing during 2019 to move ahead with their investing journey. See below our top 5.
With finance becoming exceptionally restrictive for some investors, serviceability has become the game changer for those looking to continue their investing in recent times.
As a result, those more savvy investors can take a proactive approach by reducing their outgoings, and managing their cash flow better. Examples of how this can be applied includes:
Comparing their household expenses, including Electricity, Gas & Insurances. Sites such as Billy Sumo provide a great quick and easy process to complete this form.
Reduction in avoidable discretionary spending on items such as meals out, bars, takeaways and itunes movie rentals. Time for those serious investors to become semi-hermit, at least for a short while.
With interest rates still at record lows, and capital growth becoming harder to come by, investors can use their investing time wisely by reducing their investment expenses and negotiating a rate reduction with their banks. Refinancing is always an alternative option should a favourable rate not be available and servicing and valuations permit.
What we mean by cashing up is putting yourself in a purchase ready situation by saving up money to contribute towards deposits, holding in off-set accounts, and refinancing a& releasing equity where available.
Some say that 12-18 months time will provide great buying opportunity for the Sydney and Melbourne markets, and perhaps the best chance that investors will ever have again to get into these markets. Therefore, those motivated enough are starting their prep work right now.
With changing circumstances come changing opportunities and threats. Whilst some strategies can stand the test of time, people’s circumstances do change, and external changes can provide new opportunities not previously seen.
Competition is lower, finance is hard, sentiment is low, all of this combines to make it more difficult for vendors to sell and real estate agent to earn their commissions. As a result, a great opportunity is provided to smart investors for making offers that might be ignored in more favourable selling times. Buying under true market value can be a difficult feat, however when the circumstances pave the way, this can be a realistic outcome for those brave and motivated enough to bid low and negotiate hard.