When you buy a property to live in, usually the intention is to own your home, not how much it’s going to up in value over the next 12 months. Your purchase is full of emotions. Things like where you are going to put the couch and which wall you will hang your TV on is more important than the value going up, so if this is the case then it shouldn’t matter if the value goes up or not, right? All we should be focused on is to pay it off as quickly as possible?

When you buy an investment property, you should purchase without any emotion and purely base your decision on numbers. You should treat it like a business decision like McDonald’s would when they decide on a new store location. This research is why all their stores are guaranteed to make money. Maybe you don’t need to start tracking how many people will walk past the location, but it’s important to know how much it will cost to hold the investment property, what your exit strategy is and what factors will help drive the value of the property up.

This brings me to the media and how the media impacts our views on the property market. Why is it that our news is cluttered with articles about property? Is it because they know it will sell newspapers or is it because they genuinely want to keep us informed about the property market? Given that only 7.9% of Aussies own an investment property, how do we justify the fascination with property values? If you are one of the 7.9% that own an investment property then it’s important to know how the property market you’re in is travelling. For the rest of the population, this shouldn’t matter.

Then we have so-called ‘experts’ making bold predictions like the property market will drop by 40%, which will scare anybody away from the property market. Predictions like these are exactly what the media want us to believe and if you only listen to the media, they win. People become fearful and are more hesitant to invest in property, which is what we are seeing at the moment. Together with the tightening of banks credit policies, people are moving away from the property market, which means the demand for property is reducing.

Don’t listen to media or so-called experts to make a decision to buy a property, do your own research and as I always say the right time to buy a property was yesterday as long as you’re ready.

“I will tell you how to become rich…Be fearful when others are greedy. Be greedy when others are fearful.” – Warren Buffett