Sometime back I heard the wife of a young couple who now have three investment properties say, “this property investing is addictive”. Maybe so. It does make you wonder about the word ‘addiction’ as much as it does about ‘property investing’.
Just recently another couple I know were going to buy a property which needed massive renovation. As the whole buying process was coming together the wife started getting very concerned about the renovation and how it was going to affect the family. They had renovated before when they had no children but now there are 3 littlies and although the plan was to take on contractors for the job, they both new that the hubby is a very hands on guy and would want to be involved too. But he was already working 65-75 hours a week! In the end they backed off the idea.
The moral of the story is: Before going to contract on a property, investment or otherwise, do check that you have covered all bases as in making sure the investment is not going to crash around your ears.
Checking the basics
We talk about buying the right property, getting the best finance, getting the property checked for building and pest, tenanting the property, etc., but there are other considerations that a couple needs to evaluate as well.
Family and stress levels
- no matter what we do in life family comes first – without it you can end up a very lonely person in old age, so make sure that any steps you take are OK with the family lifestyle and your time commitments to the family
- keeping life on an even keel – I think we all know that when building a property portfolio there needs to be some sacrifices, but make sure that it is not at the cost of the family, ensure that the time is right for all members of the family and that all members of the investment can handle the stress levels being instigated by a new purchase
- finance – not the getting of finance, but being able to meet any interest rate rises during the term of the loan – don’t rely on increased income to meet these obligations, make sure that there is a buffer in the bank account for any eventualities that may occur and that you can cover yourself for at least 6 months
- income – there is nothing guaranteed in life and that includes your job so make sure you are covered for your income with income insurance