There are many different strategies to make money through property and each one brings with it a different level of risk. You need to understand your own comfort level in terms of risk, and select an investment strategy that is well aligned with your tolerance to Kamagra risk.

If your tolerance to risk is not aligned with your selected strategy, you will either have many sleepless nights, or feel frustrated because you feel you are not maximising opportunities and could be buying more property.

Here are 7 questions to get you thinking about your tolerance to risk.

1. How much equity do you have available in your current property and/or investments?

Some people will invest when they have 20% equity in their property.

For example, your home may be worth $400,000 with a loan of $320,000. You have 20% equity in the property. Some investors will feel ready to buy their first investment property at this point. Others may prefer to pay off more of their loan, before they purchase their first investment property. What do you feel comfortable with?

2. What level of gearing do you feel comfortable with?

Using the example above, if you have a $320,000 loan on a property valued at $400,000, you are 80% geared. This means you own 20% of the property, and your lender owns 80%.

I have a low tolerance to risk and prefer our gearing Viagra Jelly to be as low as 50%. The longer you hold the property, the better the gearing ratio becomes as property values increase, and/or loans are paid down.

3. How much cash do you have ready access to?

The reality is challenging situations do happen. Your tenant moves out, the hot water system needs replacing, one of your properties won’t sell and/or interest rates go up. Do you have ready access to cash to help you through difficult times?

4. What amount of loan do you feel comfortable servicing?

Do you feel comfortable holding a $1,000,000 loan, $2,000,000 loan or perhaps only $400,000 if you want to sleep at night?

5. What is the worse case scenario? Do you have a back up plan?

What if you can’t sell one of your properties, and you are left servicing the loan? Do you have access to cash to keep servicing the loan until you sell the property? Do you feel comfortable selling the property at a loss? How long would it take you to make the decision to sell at a loss? What impact will holding the property have on your cash-flow?

6. Do you have an investment checklist?

Do you have a checklist of what you are looking for in a property? Is the checklist tailored to your specific investment strategy? Only buy property that meets all the criteria on your checklist.

7. Do you update your personal financial statements?

You should always know your current financial state and cashflow position before you make an investment decision. Keep your personal Balance Sheet and Cashflow Statements up to date. Businesses always know their current financial position … you should too. Property investing is a business.

Define your personal investing rules … and stick to them. Mistakes are made when investors do not follow their own rules, possibly due to an external influence. Suddenly emotion is in charge … not well-informed decision-making.

Property is a long-term investment strategy. If you put yourself in a situation outside of your tolerance for risk, you may lose the confidence to stay in the market for the long-term.

Author Bio: Suzie Crawford works with people who are tired of working for others and want expert guidance on how to make money through property. best place to buy cialis Register here for free 8-week online Training Program PLUS receive bonuses to the value of $162. http://www.youcan.com.au

Category: Finance/Real Estate
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