Build your portfolio faster
Unlocking equity to leapfrog into your next investment property will enable you to swiftly build your portfolio. And why just wait for capital growth to kick in when you can also proactively accelerate the process with some simple practical tips?
To access equity, the first step involves carrying out a valuation on the property. This then determines how much equity the investor can draw out to fund their next investment.
Renovation and styling
Aussie Home Loans’ Ross Le Quesne says they generally find that investors can recycle their equity quicker if they renovate their property shortly after purchase.
“That changes the nature of the property, and the valuer is more likely to say ‘yes, I can see where you’ve increased value’,” he says, adding that the investor can also show the valuer before and after shots of the property or physically showing them around.
Mr Le Quesne provides some basic tips that can help investors boost their valuations:
- Making sure the garden is well looked after by the tenants;
- The lawns are mowed;
- And the property is presented in a neat and tidy fashion
The way the property is styled and presented can go a long way.
How long? In the case of Smart Property Investment’s Berkeley Vale property, having the property tidied and professionally staged contributed to a significant $75,000 difference in valuation, Mr Le Quesne explains.
More valuation tips
Even though the investor may have purchased well, the valuer is unlikely to provide a valuation of $30,000 to $40,000 above the purchase price six months later, he continues, because they will be using comparative sales.
Despite this, performing your due diligence and providing valuers with your own set of comparable sales can make a difference.
“If the client can make it as easy as possible for the valuer, then they’re more likely to get a favourable and on market result,” Mr Le Quesne advises.