History
has proven that in times of economic change and uncertainty there exists great
opportunities...
So how can you take advantage of these times?
First of all you need to find a way
to ignore the negative fog created by the media. Although it seems
inconceivable; they often write about subjects that they have not adequately
researched.
It is also important to remember that some people who predict doom
and gloom in the media are just seeking attention.
Give the media some thought but don’t
rely solely on what you read or see on TV.
Secondly; you need to do your own
research or find someone who can provide independent advice to help you find
the right property for your circumstances.
You need to look for someone who can
look to the future to see what impact economic changes and other factors might
have on particular locations.
One equalizer for all investors is
that none of us can predict the future, but looking at what changes are known
to be going to occur can be a good indicator of future property price movements.
For example a closing of a factory can cause economic hardship in the
surrounding area and property prices are likely to fall as people sell up and move
away looking for new employment. Crime is also likely to increase in the area
and this will result in a lower demand for properties making those properties on
the market even harder to sell.
Conversely an area where there is likely to be
gentrification of an older suburb can result in higher demand and more than
average price increases. These conditional changes can occur in both good time
and in bad but there is more money to be made in times of uncertainty.
The above is one area where
Investment Property Finders can help. We are independent and help you find the
right property for your circumstances taking into account any known or
impending changes.
Where
are we today?
It just so happens that Australia is at a
time when there seems to be a heightened degree of uncertainty. Our real estate
prices have consistently appreciated for over 15 years. Yields are low,
rental prices are stagnant and lending is tightening up. And the media continue
to push this non-existent “boom or bust cycle” in residential property. (Australian property doesn’t “boom”, it
grows either slowly or more rapidly and it has never experienced a “bust”, it
simply slows down for a period. There is a well recognisable cycle, ask us for
more detail.)
All of this leads us to uncertainty
in property markets.
So there are some basic truths to remember…
Investing will always involve uncertainty…
At any point in the future, property
values will increase, remain stagnant or go down. There are no other
alternatives. Accept that that never changes.
At every point in history, you
were just as uncertain as you are today about what the future holds. You might
have felt more certain, having an opinion based on your perception of market
conditions, but your feelings of certainty were an illusion. Good times
follow bad and vice versa.
This is why investing involves risk,
and therefore a corresponding return. Remember risk equals reward. When we
accept this reality, we are in a position to identify the risks, and then
proactively mitigate them.
But we can never completely remove
the uncertainty.
Don’t
let negativity paralyse you…
Over the past months, the media
reports on the global economy have been quite bleak. China seems to be
struggling, and financial markets around the world are flashing red, creating
fear in the psyche of investors.
A recent poll concluded that one in
five investors plan to do nothing in real estate for the next year. This situation creates opportunities for
well informed investors.
But if you’re sitting this year out
be sure you haven’t succumbed to irrational fear. There have only been a few
times in history when the economic sky was actually falling.
Even during the Global Financial Crisis we had client
grabbing bargains and make money.
Find
creative solutions to boosting your income
Depending on your goals, strategy and
your financial situation, the best use of your time if you are definitely not
investing may be to focus on increasing your income.
Many investment experts emphasise the importance of creating a “Passive Income” that will fast track your
progress toward financial freedom.
Passive Income(an income accelerator) adds to your income, but not on a pay per hour of work
basis. Passive income is income you derive through leveraging, so you don’t
need to trade your time for money.
It may involve starting an Internet
business, harnessing your intellectual capital, trading options or even direct
sales. In this new world of internet and the power of social media don’t
completely discount network marketing without giving it a reasonable due
diligence.
There are also certain types of
property that will produce Passive Income.
Figuring out your income accelerator may
be just as important as working out your property investing strategy, because
the money you’ll bring in the door with your accelerator is what you’ll be
taking out the door to buy properties.
We have some ideas you could consider
here: www.investmentpropertyfinders.com.au/CashflowOps
Focus
on information and education
When situations of heightened
uncertainty arise, the best defense is to increase your knowledge, skills and
competency. That way, you’ll be able to recognise opportunities that already
exist, avoid opportunities that are foolish, and take advantage of
opportunities that arise when the market shifts in your favor.
In fact, seasons of heightened
uncertainty often lead to the greatest opportunities, as long as you have
positioned yourself well. On the other hand, if you’ve sat idle and inactive
while waiting for your fears to pass, then you’re more likely to miss out or
make a financial mistake.
Investment Property Finders are
always happy to answer any questions that you might have on your path to
successful property investment.
Good luck and we hope to hear from
you…
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