5 steps to a successful property purchase

Now I understand why this is the case - where are we ever taught about property in our lives? Of course, we are not. Here is a 5-part framework for you to use when you begin to turn your property investment from a hobby into your own part-time business, and businesses are designed to make a profit!

1) Know where you are going

Any investment journey needs to start with an outcome. As much as we love and adore property, in the end it is just a vehicle to achieve a financial result to give us more choices in our personal lives. What choices do you want to have? AS the answer to this question changes everything from this moment on.

Key point: Give yourself a direction so a strategy can take you there.

2) Strategy comes first

Most investors have a strategy of “buy and hope”. They buy a property and then hope like hell it goes up! This really of course means, they have no strategy and then wonder why they don’t get the results they want.

A proper investment strategy is really an architecture built from your life and takes into account everything from your dreams and goals, your current financial position, your stage of life, risk profile, time frames, time availability, skill sets etc.

These all need to be considered when constructing the road map to lead you down the path to your ultimate portfolio. In the end, a strategy should result in a clearly laid out set of buying rules so you know exactly what type of property you are looking for, the price point, the yield, the type of market and the outcome you expect out of each and every property.

Key point: Strategy separates an investor from a gambler.

3) Choose the market based on the strategy

You now have your strategy and set of buying rules, so what do you do with it?

A lot of people just go into any market and try and make a strategy work, and of course this is usually in their own back yard because it is what they know and are comfortable with. But unfortunately, potentially not the best place to put your money.

The truth is we cannot control the market place; as individuals we cannot dictate whether the market goes up, down or sideways. The only thing we can control is getting educated and learning how to do great due diligence, and finding a market that suits the outcomes we are trying to achieve.  

You have to learn to invest outside of the 3km square radius of your own home to really maximise your results, this is really about getting educated and overcoming fear.

Key point: Never get caught up in the location, get caught up in the result.

4) Choose the product for the market

I always say to my clients, ‘buy property with who you are going to sell it to in mind’. Now that doesn’t mean you are going to sell it, it just means finding out what is important to the people who live in the area you are investing in. Make a point to understand the demographic and find the product, which more people are going to fight for.

For example, in some areas, house and land is still the darling of the area, in others units are taking over as the preferred lower maintenance living option. Some areas, accept terrace housing, for others it is new and foreign and uncomfortable for them to buy and therefore they won’t in mass.

Key point: Find out what the local market wants and then give it to them.

5) The Deal

The final component is looking for the deal itself, which fits your strategy and your set of buying rules, which were clearly laid out in step number one.

In the end it all comes down to numbers, that is what makes a good deal. You must take all of the emotion out of the deal and look at the cold hard facts.  How am I making my money? And how does it fit into my strategy and the results I am committed to creating in my life?

Key point: Numbers don’t lie. Learn to love and understand them.

About Todd Polke
As a Property Investment Coach, personal mentor and professional speaker Todd helps every day people take their personal, professional and financial lives to the next level. ??Having been mentored by some of the best in the business in property, shares, business, mindset, health and personal growth, Todd built a multi million-dollar investment portfolio by his mid 20’s and now shares this knowledge and experience with investors of all levels through Investment seminars and workshops across Australia and internationally. ??

As well as being the NSW Head Mentoring Coach for Positive Real Estate, he is the founder of Young Wealth; dedicated to helping the next generations get their wealthiest start in life.

He has been invited to speak Australia wide and internationally on investment strategy, wealth creation and on wealth psychology. Todd’s passion is to equip and empower people with the tools, skills, education and beliefs required to reach their full potential and live a life unlimited by income.

To contact Todd go to www.toddpolke.com or visit www.positiverealestate.com.au to attend Todd’s next speaking event.