With a rising market, the biggest challenge is to make sure you don’t pay too much. We have experienced rising markets many times before and it’s important to remain calm and make decisions purely on research and data, and not on emotions.
During our search, property prices were continuing to rise and had been for many years in this region (20% in the past 3 years alone) – unlike the Sydney market. Being familiar with the market, we had a good idea of what properties in various regional towns were worth, in different pockets and streets, which were higher in demand and so on, so this made it easier for us to determine good value for our client.
After inspecting a number of properties and presenting them to Lucy for comparison, we explained to her which property would make the best investment for the short and long term. We provided full property profile reports with data on the property, the town, demographics, population, jobs growth, infrastructure and so on.
We believe it’s important to educate our clients along the journey, so they can get an understanding of what makes an investment grade property and why certain properties have been selected over others.
NEGOTIATIONS & ACQUISITION
After narrowing down the list of shortlisted properties to one stand out property in the Central West region of NSW – a 3 bedroom, 2 bathroom house with multiple living areas on a large corner block, it came time to negotiate.
Given the property was on the market for a little while and the vendor was originally asking $409k, we were going to have to work hard to get this down to a price we were comfortable with, making sure Lucy wasn’t over paying.
Knowing it was going to be a great first investment for Lucy to set the foundations of her property portfolio with a further 10-12% growth expected in the next 12 months, we were keen to secure this deal. After submitting an offer, the agent came back to us saying the vendor had now decided to hold on to the property and put a tenant in there.
This was not an ideal situation, so we knew that we had to be very persistent to get them to change their mind and give them an attractive incentive.
The next email came through with ‘Congratulations…..’ and we were relieved that all our hard work and persistence had paid off. Lucy was so happy to hear that our offer of $350,000 had been accepted, an incredible result compared to the vendors original asking price of $409k.
We helped Lucy organise a building & pest inspection, provided guidance on getting her formal finance approval and book in the valuation, and put her in touch with a property manager that has provided exceptional service to our previous clients.
As we were approaching settlement, we touched base with the property manager to start marketing the property for rent. After the first open house, a tenant was secured which was actually 1 week before settlement guaranteeing an income for Lucy as soon as the keys were collected. This just goes to show how important it is to choose the right property to suit the local demographics, which will make it high in demand and reduce any vacancy periods.
If you’re looking to invest and want similar results, then please get in touch with us for a complimentary free chat.
* Their real names have not been used due to privacy.