The Loft

The Home Base blog

First Steps To A Property Portfolio

The finance experts from Bank of Queensland share a few tricks of the trade for future investors


If you have given up hope of marrying rich or winning the lottery, you are probably in need of a few new ideas to get you on your way towards a financially secure future.

Property investing could be a more sensible approach and may put you on the right path to a successful investment.

Here are four guidelines to consider:

  1. Keep in mind a high-level strategy or plan
    Have you found a great piece of property, and are now shopping around for the best possible loan? Before you commit to borrowing, think about what success would look like to you. Ask yourself difficult questions to ensure you’re prepared, rather than be surprised by unexpected changes.

    • Is there a limit to the amount you can afford to guarantee?
    • Have you clearly set goals for the property?
    • Will tenants provide you with adequate value until you’re ready to sell? By creating a long-term plan with smaller milestones, it will allow you to evaluate whether your investment is showing the returns you originally expected. This also helps to remove some of the uncertainty in managing the property.
  2. Minimise the amount of time you spend managing your investment
    While it might sound strange to adopt a hands-off approach to managing your property investments, the more you’re able to remove yourself from the process, the more likely you’ll make rational decisions. Although you’ve contributed a large portion of your own money, the aim of a strong investment is to make a financially profitable return. The less attached you are to the finer details of your property, the more easily you’ll be able to make difficult decisions.

    • If renovations are required, obtain quotes from painters and other tradespeople, in order to reduce your hands-on time with the property.
    • Allow the landlords and body corporate groups to take away some of the pressure where possible. This way, you can spend your time making strategic decisions that will be more beneficial in the long term.
  3. Understand your ongoing expenses and find an easy way to keep track of them
    In addition to your investment loan repayments, factor in any fees and additional expenditures you may encounter.

    • Insurance – If you’re borrowing a significant portion of your loan, you want to look into insurance to protect your investment in the event of serious injury, disability or involuntary unemployment where you can no longer afford to repay the loan.
    • Ongoing Account Fees – These are paid to your financial provider for managing the account on a monthly or yearly basis.
    • Body Corporate Fees – As an owner of a unit or apartment, you also become a member of the body corporate. Fees must be paid to assist in covering building insurance, maintenance of utilities and other areas that are publicly accessible. These areas are generally located outside the individual unit itself (i.e. outside lights, exterior of the building, pools, tennis courts).
    • Council or Government Rates – These fees are usually paid quarterly, and cover a range of government services, including refuse collection and street maintenance. Each council has different rates, so ensure you research the likely figure you’ll be required to pay.
  4. Look for quick wins early on that might attract a better tenant
    Quick wins can be as simple as touching up painting, adding new small fittings or whitening the grout between tiles. Small visual improvements can make the world of difference to the overall aesthetics and atmosphere of a property. Removing existing furniture to promote a longer stay inside the property can also be a beneficial option when property investing. The more furniture and appliances that tenants are required to move into a property, the less likely they will be willing to move again in six months time. Set a small budget and relatively tight timeline when considering these kinds of enhancements, as it shouldn’t be classified as a full renovation. The aim is to minimise the amount of time invested into the maintenance of the property. The less time spent with a property, the less emotionally attached investors are, allowing open-minded, rational decisions.