Investment, as they say, is not an exact science, and the same applies when it comes to property investments. There are many variables which make property investments a bit difficult such as market fluctuations, changes in the interest rates, and even emotional decision making. There are factors which make property investments harder such as changing financial situations. This is why it is always prudent to make your property investments from a point of knowledge. Peter Spann’s guide to buying property, which is codified in many of his investment and wealth books, is one of the best pieces of advice that you can follow in order for you to get it right when it comes to property investments.
By using Peter Spann’s property guide, it will be possible for you to invest and get the best value from your properties. Property investors generally make some common mistakes, which can be avoided when you use thePeter Spann’s guide to buying property. These include the following:
1. Repaying Your Debts Indiscriminately
This is one of the most common mistakes that investors make when it comes to investing in property. It is always a tempting prospect to pay all your debts simultaneously. But not all debts are created equal. Some debts are more favorable than others and may come with certain rewards when you make the earliest possible payments. These benefits can be in the form of tax deductibles.
It is always advisable to make use of your spare cash in order to clear your non-tax deductible debts. These generally include debts such as personal loans secured for car or debt secured for financing your principal place of residence. Once these are out of the way, you can work your way to the tax-deductible debts such as the loans that you secured on your investment property.
This strategy will allow you to minimize those debts that do not generate any cash value while maximizing on those that generate cash value on your investments. If you read the various guides and books on investing in property with Peter Spann, you will learn some critical strategies on how to manage your debt while building your property investment portfolio.
2. You Forget About Depreciation
This is another common mistake that many first time property buyers are likely to make. It is always advisable to make the most of the tax depreciation deductions on your investment properties. By failing to make the most of these deductions, you will be missing out big on hundreds or even thousands of dollars in potential returns for your property. It is always advisable to hire a Quantity Surveyor that can prepare a depreciation schedule for your investment property.
3. Allowing Rent to Stagnate
Allowing rental payments to stagnate for a long duration of time and then increasing it suddenly is another common mistake that most property investors make. It is better to have small increments of even $10 or $20 after every lease renewal rather than a large $100 rental renewal.
4. Being inflexible
Lack of flexibility is one of the common problems that many investors make. Lack of flexibility will most likely lead to low occupancy rates in the rental property. Even making a $50 cut in the weekly rental rate can generate income that you would otherwise be losing while waiting for a better rental deal.
With Peter Spann’s guide to buying property, you can avoid some of these pitfalls and carry out a successful real estate investment. You can invest in Australia with Peter Spann and mitigate some of those risks that you might not be aware of when it comes to property investing. When you equip yourself with the right set of knowledge on property investments, you can simplify your property management process considerably.