How do you know when it’s the right time to invest in property? Property investments can be some of the best long-term investments out there, but they’re not automatic money machines.
It takes a lot of careful consideration to choose the right property and to manage it successfully. If you’re thinking of buying an investment property, you need to make sure you’re at the right stage in your life to make it a sensible decision.
It also needs to be the right time in terms of the condition of the housing market, but you should consider your personal circumstances too. Here are some of the things you might want to check.
You Own Your Home
If you want to buy your first investment property, you should own your own home first. It puts you in a more secure position, as long as you meet your mortgage payments.
Buying an investment property before you own your home can be tough as getting a loan for the property can be harder. Of course, if you have a mortgage on your home, this needs to be taken into account when you’re being considered for an investment property loan.
But it can help to show that you are capable of meeting your mortgage payments on time and that you can be trusted with a large investment.
You Have Some Time to Give
It would be great if you could just sit back and watch your rent coming in. However, if you’re going to invest in property, you need to be willing to give some of your time to manage it.
While you can use a property management service, this will cost you money and won’t really be worth it for just one property. So you need to be willing to give your time for things like arranging repairs or handling tenants moving in and out. This goes double for if you want to invest in overseas property.
You might have someone local who can help you. However, you should still make time to check out the property and meet the tenants now and then.
You Can Afford It
Money is obviously a big issue to consider. You need to be able to afford the investment and to be able to secure a loan on it, assuming you’re not paying in cash.
You might think you can easily meet any expenses when your property is occupied by tenants. But what if it ends up being empty for several months? You need to do some sums and ensure you can afford the costs.
You’re Ready for a Long-term Investment
Property is usually meant to be a long-term investment. You might be holding onto it for a decade or more, putting in a lot of time and money.
Before you decide to put your money into an investment property, make sure you’re ready for the commitment. You need to be willing to give your time and act as a responsible landlord.
It might not be your time to invest in property just yet, or you could be ready to take the leap. Whichever it is, choose the right decision for you.
Are you ready to invest in property? Share your thoughts below and let me know.