You’ve read the books, magazines and reports. You’ve been religiously checking real estate websites for properties. Yet when push comes to shove, you get stopped.  A lot of people get overwhelmed by the process and quit before they even begin. Reality is, property investing is pretty simple.

So here are eight steps to starting a property portfolio on a solid ground, without losing your mind…

1. Check your finances

This can be as simple as listing all your assets, including incomes and work out your expenses. This will give you an idea how much cash you have available to invest. Don’t immediately assume that you can’t afford to invest. As long as you have a stable and reasonably good paying job with solid employment history, you won’t have a problem getting a loan.

2. Get a pre-approval

You can get pre-approval through your lender directly or through your mortgage broker. Going through a broker before applying for a pre-approval can be beneficial if you’re not sure you’re financially ready to invest. Applying for multiple pre-approvals is not a good idea as this can send a red flag to the lender who may refuse your application.

3. Set your goals

What are you looking to achieve? What does success look like to you? In order for you to achieve your goals, you must first articulate what your goals are. More importantly, you need to set a deadline as to when you want to achieve these. Then you can work backwards.

4. Understand your attitude to risk

What sort of risk can you tolerate? Getting an understanding of your own attitude to risk will help you create a strategy that reflects this.

5. Start budgeting

Budgeting is the only way to ensure you’re able to balance your income and expenses. It allows you to see where you’ve been spending your money and helps you to plan for bigger expenses down the line. There’s good budgeting software available, such as this budget planner. It is a good idea to work out your budget before you even start looking for an investment property.

6. Create a purchase plan

Your purchase plan should reflect your goals of growing your portfolio to a point where it’s producing the growth or income you’re aiming for.

Here is an example of a purchase plan you can follow:

• Define your strategy
• Set up your criteria
• Do your research
• Cull your list
• Get appraisal
• Do your due diligence
• Make and offer and negotiate

7. Be informed

For informative market advice on the possible rental return and process, contact our friendly Property Investment Consultants, Angela King and Ben Pattison,  on 02 6939 7177.

8. Stay focused

Investing in property is a business choice, not an emotional one. Be clear about what you want to achieve. Set a date as to when you want to achieve this goal. Identify milestones you need to do to get to your goals.