Tag Archives: Bargain

How to find a bargain investment property

How to find a bargain investment property

One of the keys of being a successful property investor is getting to the property before the competition and getting the property under market value. But how do you do that? It comes down to planning.

Research and Planning

You need to do lots and lots of research! The numbers don’t lie and you need to have accurate historical data to make informed decisions. Some (but not all) of the areas you need to cover in your research are:

  • Median price in the suburb that you are investigating – past 12 months, 5 years and 10 years
  • Track property sales in the targeted suburb. Which ones are going to auction, which are being passed in. Ask for price guides from agents. (Keep a closer eye on comparable properties)
  • When you are looking at a particular property, find out what it last sold for, when and how long it stayed on the market.

Consider a buyer’s agent

They are on your side, they are trying to get the best deal and they take the emotion out of it all. Send the agent to auctions to ensure you don’t get caught up in the excitement and go above your budget. They will also be an expert in the areas that you are looking at, and from their experience they will be able to give you a general idea of what a property is worth.

Make an offer

Sometimes you might want to put in an offer before a property goes to auction (if that is where it is headed). Some vendors may want to skip the auction stress altogether and jump on your offer. Also, have a good negotiation strategy – not offering your top dollar first off is a good move.

Know when to walk away

There is always going to be another property around the corner. So if you miss out on one because it has gone over your budget, don’t worry another one is on its way. Plus, you never know, the vendor may not be able to sell their place for their asking price and may get back in touch.

What other things can you do to snap up a bargain?

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Should I consider buying at a Mortgagee Sale?

 

Should I consider buying at a Mortgagee Sale? Whether you a new on the property ladder or an investor looking to snap up a bargain, looking at buying a property at a Mortgagee Sale or Auction could be the way to go. While it seems like it could be a good deal, buyers have to be aware of a few things before they sign the contract.

Is it really a bargain?

A mortgagee sale is an auction and potential buyers can get excited and carried away with their bidding. Always decide on your maximum budget and arrange to get finance before attending the auction. Mortgagee sales are often rushed so the settlement period may be less than a regular sale or auction. It always pays to do your homework before the auction day and get all your LIM and builders reports beforehand. Read the purchase agreement thoroughly because sometimes the agreement that purchasers sign at a mortgagee sale does not include all of the fine print clauses that are there to protect purchasers in standard auction agreements.

Is it in good condition?

While you may go and view the property before the auction, sometime the previous owners may be upset the bank is selling it and trash the place before the settlement date. Always arrange insurance from the day of the auction, just to be on the safe side. Also, it is safe to assume the previous owners fell on hard times financially and haven’t kept up with  the maintenance of the property, so any money you save may have to go towards renovations. Be aware that often the chattels are not included in the sale and the previous owners may remove them.

While there are bargains to be found at mortgagee sales, it is definitely buyer beware so always take necessary precautions to protect yourself and your assets.

Have you ever snapped up a bargain at a mortgagee sale?