27 Feb Why you must start planning for next year now – Reshmi Kumar

It’s only a few weeks until the end of 2018 and many of us are no doubt just putting one foot in front of the other until the holidays get here. 
While we all should look forward to some much deserved down-time with our families over Christmas, those of us committed to making the most of the current market conditions are planning for next year already. 

Market opportunity 

While we might see lots of negative stories in the media about the state of “the market”, the reality is that the current slower conditions mean plenty of opportunities for savvy investors. 
One of my biggest bugbears with much of the reporting lately is when they lump the whole country into one national market, when such a thing doesn’t exist. 
Australia is a country of eight capital cities, plus a number of strong regional locations, which each have individual markets and economies doing different things.
A case in point over recent years was Sydney’s market recording double-digit price growth, while places like Adelaide and Brisbane were relatively flat, according to median price reports. 
So, while many people were suffering from Fear Of Missing Out in Sydney and driving sustainable high prices, Victor and I were quietly investing in locations like Brisbane because of the affordable buy-in prices as well as the stronger yields available.   
Interstate investment is a key part of our portfolio because we can make the most of market conditions in different locations, plus it also creates diversity that helps to protect it from any temporary market ups and downs. 
What I mean is that if one location is experiencing flat market conditions, then our properties in areas with stronger markets will do the heavy lifting for a period of time.

Make time to plan 

Creating a property investment strategy is essential if you want to grow a portfolio, however, far too many investors still don’t seem to have a plan at all. 
Like that old saying goes, a failure to plan is a plan to fail!
So, as well as actually creating a plan, you must also review your financial position to ascertain the options available to you next year to grow your portfolio.
This is always important and especially so at the moment because it is taking longer than usual to secure ​finance because of tighter lending conditions.  
While Victor and I have always had issues with finance – in the beginning because we didn’t have much money and now because our portfolio is seemingly too big – we have always successfully secured investment funds because of our understanding of the system. 
Part of that understanding is ensuring that we always have all the necessary paperwork up-to-date and verified so that our loan applications are as clean as possible. 
While plenty of people might moan about banks, at the end the day we can’t invest without them, so it makes sense to make their job as easy as possible.
No one likes wading through a messy application for anything, let alone for something as important as a property loan after all.
Part of the process, especially at the moment, is to understand your finances thoroughly, including your actual living expenses – not the figure that you think you might spend every month!

New year, new attitude

As we head into 2019, markets across the country are providing plenty of opportunities for investors who can make the most of reduced demand from buyers generally.
Of course, fewer buyers means you will likely have a stronger negotiating position with sellers and that can result in securing solid properties for more affordable prices. 
So, while time can sometimes seem like it’s in short supply, my advice is to try and find at least an hour or two to start planning for next year.
That way, when the clock chimes past midnight on New Year’s Eve, you can begin the year with a plan and with the confidence that your finances are in tip-top shape.
Until next time, I hope you and your family have a wonderful Christmas and New Year, and I look forward to seeing you all next year!