There are many factors besides price that astute buyers will consider before investing in property. Here are 6 factors to keep in mind.
Fortunes have been made by investing in property but, and there is a very big but, generally it's only those who truly know how to capitalise on a situation that make pots of money.
So what is the secret to buying property at a bargain-basement price and more importantly, does it mean you’re guaranteed to make money simply because you managed to snap up a home for what you consider a ridiculously low sum? The short answer is no. There is so much more to buying a property than price, and there are several other important things to take into account before signing a sales agreement.
It is vital to have a good understanding of the market you are buying into. Markets change from area to area and sometimes even from street to street. Don't rush into something simply because the deal looks good - take a long hard look at the area, investigate what's been sold there and at what price and then make an informed decision. Demand drives prices, so buying a property with a rock-bottom price tag in some far flung area where the demand is low will probably come back to bite when it comes time to sell. At the same time, expecting to make a serious profit from a sale in an area which has a glut of properties on the market could also backfire and you could end up losing out. Consult with local estate agents in order to get a clear picture of the local market conditions and only invest once you have all the facts at your disposal.
Keep your eyes peeled
Bargains come onto the market every day and are generally snatched up quickly. Scour estate agents’ websites daily and sign up with property portals like Private Property in order to receive instant alerts when something new comes onto the market.
Read the fine print
Keep an eye out for legal notices and note which homes are being repossessed. Go and view the home before the sale, and just a word of warning: those buying a home which has been repossessed by a municipality will have to settle any outstanding debt before the sale can be concluded. Go to the municipal offices in order to ascertain how much is owed and factor this into the price before bidding.
Many ‘bargain’ properties are marketed as needing a little TLC and indeed there are properties which have been bought for a song because work needed to be carried out before the owner could move in. The big question here has to be how much work it's going to take to get the home habitable, and at what cost. Do the maths before you buy.
Price is king
A listing that's been on the market for a lengthy period without a drop in price is unlikely to be a good buy for those seeking a bargain. This is because these sellers are usually unwilling to negotiate - those who are desperate to sell will lower the price if there are no takers which generally makes them more willing to negotiate in order to get the property sold.
Once you've done your homework and recognise a good deal when it presents itself, act on it as soon as possible. Remember there are others who, like you, want to bag a good deal and those who dither could end up losing out on the bargain of a lifetime.