It's not easy being a member of Gen Y, especially when it comes to getting your foot in the door in the competitive property market that has set in across the Gold Coast and Brisbane. As a first home buyer there are grants and concessions on transfer duty available to make your purchase slightly more affordable, however with prices now at all time highs it is increasingly difficult to push that door ajar and nab yourself that first set of keys.
As conveyancing solicitors recently stumbled upon this great article which shares some practical tips that can make buying your first property that little bit easier and hopefully make your dreams a reality when it comes to buying your first home and building a property portfolio.
10 Tips to Become a Gen Y Property Guru:
At first glance it appears that the property market in Australia is a rather bleak place for potential buyers, especially Gen Y first time buyers.
Dilapidated, barely standing shacks are being sold in Sydney for millions of dollars and the average price for a ‘starter’ home keeps climbing year after year.
With all the negative media surrounding the concept of Gen Ys ever owning property, let alone building a flourishing portfolio of investment properties, it’s easy for the younger generations in Australia to assume that property ownership is not on the cards for them.
But some Gen Ys have managed to make it work. Find out how they managed to build an impressive property portfolio at such a young age.
1. Keep Your Eye on the Prize:
David Traeger from DT Property management says the number one factor in building a decent portfolio is to keep focused on your goals and what you want to achieve.
“Have a good work ethic; pick a goal and keep working towards it even though some days things don’t go your way,” he says.
Traeger says property investment isn’t for the faint hearted and it takes a lot of work and focus, so you need to start your journey with a positive attitude to keep you in good spirits when things get rough.
2. Start Small:
Chloë Constantinides from Dapper Apps recommends starting small. She says there’s “less outlay, less risk and bigger market to rent/sell to”. She says it’s important to start off with a manageable investment so you can make your first mistakes on a less risky and expensive property.
3. Protect Pourself:
This is one thing Gen Y property investors typically ignore or procrastinate about organising when they first enter the market.
Daniel Cohen from First Home Buyers Australia says it’s crucial to get good protection.
“If you are planning on purchasing a property, whether one, or a portfolio, it’s important to get protection,” he says.
“Most young Australians are severely underinsured. If you haven’t got things like life insurance yet, you need to get it by the time you purchase your first property.
“Ask yourself, how would you afford your home loan repayments if you lost your ability to earn an income due to a medical circumstance? If you aren’t sure what protection you need, speak to a licensed professional.”
4. Invest in Yourself:
No one has a natural ability to play the investment market like a pro – these skills are learned. Traeger recommends investing in yourself by attending workshops, seminars and conferences.
He says if your portfolio is worth investing your money into, it’s worth investing your time into as well.
5. Negotiate, Negotiate, Negotiate:
It’s mandatory to skill up your negotiating prowess in the property market.
“Negotiating is essential in the property world. Don’t forget to negotiate everything. The property price, settlement terms, home loan terms, expert fees, everything,” he says.
“It’s better to have the extra savings in your pockets then someone else’s.”
6. Use your Head:
Buying property can be an emotional experience but Constantinides says it’s important to leave your heart out of it.
“You should be asking yourself, is this a smart business decision? Not, is this somewhere I could live?,” she advises.
7. Have a Checklist:
There are so many finite details to consider when buying a home and it can be easy to overlook vital details about the property. Cohen suggests writing up a checklist to take with you to each property viewing.
“When buying a property it is easy to forget an area area or factor to look at. The best way not to forget anything when looking at properties is to use a comprehensive checklist,” he says.
“Don’t rush when looking at open houses. Take your time and look closely”
8. Say No:
Buying up too quickly in the property market could lead to your downfall. Constantinides recommends always buying well, remembering quality over quantity and walking away if you can’t secure the property at the right price.
9. Embrace Your Sacrifices:
Traeger says many Gen Ys are reluctant to buy property as it’s a huge strain on their disposable incomes. But he suggests embracing these sacrifices.
He says fancy cars and expensive wine are short term pleasures – stay focused on the long term financial benefits of property investment and you will likely enjoy fancy cars and expensive wine, as well as your ten properties, when you retire at the age of 50.
10. Research, Research, Research:
Telling people to research is easier said than done given the vast amount of information there is. As a solution to this Constantinides recommends narrowing your search.
“Focus on a handful of areas you want to invest in and research, research, research. You need to know a good buy when it comes up.”
Article written by Carly Jacobs and originally published on realestate.com.au.