You’ve been thinking about getting on the property ladder for a while now. Renting is all well and good when you’re young, footloose and fancy-free. But now you’re looking for something more permanent, not to mention a decent investment for the future. Buying your own place seems like the obvious next step. But where do you start? 2024 is set to be a big year for the property market, so the time is right to make your move. In this article, we’ll walk you through the key steps for successfully purchasing an investment property in 2024. From saving for a deposit and getting your finances in order, to finding the right property and navigating the mortgage process, we’ve got you covered. So, if you’re ready to take control of your financial future, read on. This guide will help you buy your first investment property with confidence.

Deciding to Invest in Property With iThink Property in 2024
 
Do your research
Before diving into a property investment, spend time researching the market and available options. Check property websites and reports to identify up-and-coming neighbourhoods where demand is increasing. See what type of properties are selling and for how much. The more you know, the better positioned you’ll be to find the right investment property for you. Determine your budget Know how much you can afford to spend on a deposit and ongoing costs like mortgage payments, repairs and property management fees. As a rule of thumb, you’ll need at least 20% as a down payment. Make sure any property you consider will generate enough rental income to cover expenses, with additional profit. The numbers have to make financial sense for your investment to be viable in the long run.
 
Consider hiring a property manager
Especially if you’re new to property investment or don’t live locally, consider hiring an experienced property manager. They can handle tasks like advertising vacancies, screening tenants, conducting inspections, organising repairs and maintenance, and collecting rent. While their fees will impact your bottom line, the time and headache they save you may well be worth the investment.
 
Look for the right property
Work with a buyer’s agent to locate suitable investment properties in your desired areas and price range. They can provide access to new listings before they hit the general market. Once you find a promising property, do a thorough inspection to check for any major defects before making an offer. The right investment property, with the right tenants, in the right location can provide strong returns for years to come. With the proper due diligence upfront, your property investment journey with iThink in 2024 will be off to a great start!
 
Researching the Best Areas and Properties for Investment
If you want to invest in property, you’ll need to do your homework. Start by researching the best locations and neighbourhoods in your city that are up and coming. Look for areas with solid infrastructure development, good schools, employment opportunities, and a stable housing market. Check sites like Zillow, Redfin or Trulia to compare property values and sales over the last five to ten years. Areas with steady growth are ideal.
 
Location, Location, Location
Once you find promising neighbourhoods, explore them in person. Drive or walk around and get a feel for the location. Look for signs of gentrification like new businesses, renovated homes, and young families. The closer an area is to amenities like public transit, shopping, dining and entertainment, the better the investment potential.
 
Find the Right Property
With the location narrowed down, you can focus on specific properties. Look for a place with opportunity to increase value through renovation or redevelopment. A fixer-upper or property with additional building potential are good options. Check with your city’s zoning board to understand what is allowed on the lot. You want a property that appeals to the largest segment of buyers when it comes time to sell.
 
Do Your Due Diligence
Never buy an investment property without thoroughly understanding all aspects of the transaction. Review the property disclosures, building inspections, title records and tax documents. Make sure there are no undisclosed problems or liens on the property. Meet with an accountant to explore financing options and ensure the investment will cash flow positively from the start.
With research, a keen eye for good location and the right property, plus due diligence, you’ll be well on your way to a successful real estate investment. The work you put in upfront will pay off for years to come!
 
Getting Pre-Approval for Your Investment Loan
The first step to buying an investment property in 2024 is getting pre-approved for a mortgage. Pre-approval means a lender has reviewed your finances and determined how much they’re willing to lend you. This puts you in a strong position when you find a property you want to make an offer on.
To get pre-approved, you’ll need to provide documents like pay stubs, tax returns, bank statements, and information on your current debts. The lender will evaluate your income, credit score, down payment amount, and debt-to-income ratio to determine how much they’ll pre-approve you for.
 
Aim for pre-approval from multiple lenders so you can compare offers and interest rates. Online lenders and credit unions may offer better rates than traditional banks. Compare both fixed-rate and adjustable-rate mortgages to see which suits your investment strategy best.
 
Once pre-approved, you can start searching for investment properties with confidence, knowing you have your financing sorted. You’ll be in a position to act fast when you find a promising opportunity. The seller will also take your offer more seriously, knowing you have already been pre-approved for a mortgage by the lender.
 
When you find a property you want to purchase, the pre-approval process will make the final loan approval quicker. The lender already has all your documentation and details. They just need to evaluate the property details and appraisal to finalise the approval.
 
Getting pre-approved is one of the most important first steps to take before searching for an investment property. With your financing pre-arranged, you can focus on finding the right property that suits your investment goals. The pre-approval gives you a competitive edge and peace of mind that your loan is sorted before you start bidding or making offers.
 
Making an Offer and Negotiating the Purchase
Do Your Research
Before making an offer, do thorough research on the investment property and check recent selling prices of comparable properties in the area. This will allow you to determine a fair offer price range and give you a stronger position when negotiating. Check factors like location, size, age, amenities and current market conditions.
 
Get Pre-Approved
Work with your mortgage lender to get pre-approved for a loan. This shows the seller you’re serious, and it gives you more credibility and leverage in the negotiation. Pre-approval also allows you to make a cash offer, even if you need a mortgage, which is attractive to sellers.
 
Make a Competitive Offer
Once you’ve determined a fair offer price, submit an offer that’s competitive for that market. You want to offer a price that’s appealing to the seller but still allows room for negotiation. Include details like the amount of your down payment, ideal closing date, and any contingencies like a home inspection.
 
Be Ready to Negotiate
Expect some back-and-forth negotiation with the seller on the offer price and terms. Come prepared with a “bottom line” price you’re willing to pay, and try to get the best overall deal within your budget. You can negotiate on things like the offer amount, down payment, closing costs, repairs, or inclusions like appliances. Stay professional and focus on objective factors rather than emotions.
 
Accept a Counteroffer or Walk Away
If the seller comes back with a counteroffer, evaluate if it’s still a good deal for you based on your research and budget. You can accept the counter, reject it and stand by your original offer, or submit a new counteroffer of your own. Be prepared to walk away from a negotiation that isn’t going to work for your financial situation. There will be other investment properties, so don’t get too emotionally attached to any one deal.
 
With some patience and persistence, you can find an investment property and negotiate a purchase price and terms that work for both you and the seller. Do your homework, come prepared, and stay focused on getting the best overall value. With the right approach, you’ll be well on your way to buying an investment home.
 
Preparing and Managing Your Investment Property
Once you purchase an investment property, the real work begins. To ensure your investment is profitable and headache-free, you need to prepare the property and establish effective management practices.
 
Property Preparation
Before renting out the property, make any necessary repairs or upgrades to maximise your rental income. Clean and declutter the space, give walls a fresh coat of neutral paint, and replace any old or broken fixtures. Consider installing smart home features like a smart thermostat or security cameras—renters will pay more for a “connected” home.
 
Set a Competitive Rent
Do some research to determine rents for comparable properties in the neighbourhood. You want to set a rent that is high enough to generate good cash flow, but not so high that the property sits vacant. It may be worthwhile to start with a slightly lower rent to attract good long-term tenants. You can then raise the rent incrementally over time with inflation and as the market allows.
 
Market and Screen Tenants
List your rental on websites like Zoopla, Rightmove and OpenRent to reach lots of prospective tenants. When you start receiving applications, screen tenants thoroughly. Check their references, credit scores, and employment to find responsible renters who will pay on time and not damage the property. It is better for a unit to sit vacant for an extra month or two than to end up with nonpaying or destructive tenants.
 
Establish Rules and Procedures
Create clear rules and procedures to minimise headaches for you and your tenants. Outline things like rent payment terms, notice periods, pet policies, and maintenance requests. Put all rules and procedures in writing in a comprehensive lease agreement. Enforce late fees and other penalties when necessary to encourage compliance.
 
Ongoing Property Management
Even after renting the unit, ongoing management is required. Conduct regular inspections to check on the property and tenants. Make necessary repairs or maintenance promptly. Review and potentially increase rent prices at lease renewal time. Stay on top of rent collection and issue late notices as needed. Effective ongoing management will help maximise your investment returns over the long run.
 
 
So, there you have it, the key steps to buying your first investment property in 2024. By following this advice, doing your research, and working with the right professionals, you’ll be well on your way to becoming a successful property investor. Just remember, it’s a marathon not a sprint, so take your time and don’t rush into any decisions. The property market moves in cycles, so be patient and wait for the right opportunity. With some hard work and smart thinking, your investment property dreams can become a reality. The future is yours to shape, so grab it with both hands. You’ve got this!

Bella