Club Property

What can you do to protect yourself from risk when investing in property?

Only buy residential, not commercial – in economic downturns, people may not need business premises but they will always need somewhere to live.
Personal insurance, particularly landlord’s insurance.
Rental managers – investing needs to be easy enough that you will keep it up for as long as necessary to achieve your goals
Slightly lower rents than the area average – to ensure consistent tenancy
Average price range – to ensure an easy sale when you are ready to use your money for something else
Flexible financial structure – to ensure a buffer to make things affordable when interest rates rise, or rents fall
Do not overextend yourself financially – if you borrow too heavily, you are vulnerable to a rise in interest rates or a fall in rents. If you commit too much of your income to servicing mortgages, so that day-to-day living becomes difficult, you will be unable to maintain your investments over a period of many years.