Property investment companies’ sole focus should be to maximise investors’ return and capital appreciation.
After all, making money is the whole point, isn’t it?!
When we choose which property investment firm to put our faith and finances into, we want to be confident that they will do their best to make us money and show us creative and lucrative ways to invest in real estate.
However, sometimes the investment firms’ intentions are questionable! How can they promise capital growth maximisation and high returns if they are promoting ‘Off the Plan’ units or small housing products even second hand in the most challenging, least profitable, black listed areas, such as Brisbane or Melbourne inner city, Perth, and various western Sydney locations? Accurate research and risk analysis proves that the markets with those specific asset classes will be stagnant for the foreseeable future.
So the truth is, by promoting real estate in these areas or with this product the investment firms are actually minimising your asset capital potential, just so they can get a sale!
Ideally, as an investor, what we want is at least a 3-4% appreciation every year or around 20% in 3 years. If we multiple this by 5 times, we’ll get a significant appreciation over a 15 year period, during which time we will maximise our capital. However, if we’re paying a premium that includes a very high commission to the investment firm or the agency for the wrong asset class or the wrong property configuration, in a tough, oversupply market, we might only gain 20% over the whole 15 year term. Such a property purchase is only in the interest of the property investment firm not the buyer and the likelihood of losing money in the deal is high!
My company, Invest in Properties, is a Buyers’ Agency which offers investment and home buying advocacy. Our work is to guide buyers to buy the right asset and to build the right property portfolio by investing in properties that will genuinely appreciate in the long term. All our advice and guidance is thoroughly backed up with research, risk analysis and many years of experience, which increases the likelihood of investment success, compared to buying a piece of real estate where success is left to hope, and only hope.
Founder of investinproperties Pty Ltd