In today’s hot property market finding a bargain property purchase is tough – unless you know the tips and tricks to bag a bargain.
Here are a few ways to get the upper hand and score a great buy.
A vendor who is eager to sell is the most obvious place to look for a bargain investment property.
There are a number of reasons a vendor may be in distress such as a divorce settlement, a deceased estate, the vendor has bought elsewhere or a mortgagee sale.
Usually the seller needs to quickly dispose of the property and is willing to cut back on the price.
Though not the most pleasant of situations you are doing the vendor a favour by taking the property off their hands. And ultimately it is a business transaction - if you don’t make a move, someone else will.
Only last month I witnessed a vendor being presented with two offers.
One offer was $17,000 less than the other, however, as the cheaper offer had no other conditions attached - apart from a finance clause - the buyer was flexible to negotiate a longer settlement to accommodate the vendors circumstances.
And the vendor was happy to take the lower offer.
Be smart, be fast
You need to be on the look out so you recognise an opportunity when one arrives.
Know the market – spend a lot if time researching. Define your criteria on what you’re looking for and get informed.
If you set specific criteria around your next purchase, research the local area until you know everything about it.
You’ll then be able to recognise a bargain when one raises its head - though of course none of this will make any difference if you don’t act when the opportunity arises.
Today I had a property that was only two years old in a capital city and the vendor was willing to sell for $440,000. The property was renting for $565 per week.
While quite a number of investors wanted to have a detailed discussion to identify if it was just too good to be true, one investor appreciated the value and the return and took action to take the property off the market.
By the time all the other investors dotted their i’s and crossed the t’s and realised that this really was a good opportunity, the savvy investor already had taken the property off the market.
Preparation is key
There’s no point in looking if you don’t already have your finance arranged. Know how much you can afford to borrow and get organised.
Ensure you know what sort of rental income you need to receive in order to service the loan and look for properties that will provide this.
It’s also a good idea to line up a trusted pest and building inspector to call upon quickly when you find a winner.
Work the angles
A great property bargain is like a rough diamond – you may need to dust off a little dirt to see the true potential.
Think outside of the box and be objective when looking for a hidden gem.
Look for places that you can easily add another bedroom on to or buy properties on large blocks of land where the zoning supports you sub-diving into smaller blocks.
On a bigger scale, you could look to team up with other owners to combine a row/block of properties that could potentially turn into a development site, or you could accumulate these yourself.
Growth areas set to boom
Identify locations with growth drivers.
Check for things like major transport routes, new infrastructure, new university campuses or schools going in. These are all signs that an area is set to grow.
The key to bagging that bargain ultimately relies in knowing your criteria, knowing the market and being savvy when it comes to different opportunities.
If you want some support around developing your knowledge of the property market, get in touch.
Call 1800 600 890 or email firstname.lastname@example.org to book in a complimentary consultation and start achieving your property dreams today.