3 Tips For Gen Zs Starting Their Property Investment Journey

Starting your property investment journey can be daunting, particularly if you are a young investor. How do you get into the market, what are the best ways to get into the market, and who should you turn to for advice?

Many young people are weary of the sacrifices they may have to make in favour of paying off a loan, however buying an investment property when you’re young doesn’t mean giving up the things you love. Young Investors Club has helped young investors take their first step into the market for 27 years, and have found a few key tips that have helped young property investors along the way.

####Research Before Making Your Property Investment Property investment is about long-term growth, and the sooner you get started, the higher your prospective returns. Even if you aren’t looking to invest in property right away, it’s a good idea to look at what your options for long-term financial independence are.

One of the most common property investment mistakes beginners make is not taking the time to research the market and consult with professionals before they make the decision. Take your time to learn about the market you’re stepping into, and don’t be afraid to talk to others who invested young. This will help you to gain a realistic view of the financial journey you’ll undertake, the sacrifices you may need to make along the way, and the end rewards of your hard work.

Learning about the positive aspects of investing in property young are just as important as understanding the risks along the way. Buying at a younger age builds confidence and makes you comfortable with debt, which is an advantage for anyone looking to build a portfolio.

####Get On Top of Your Finances Early Make sure you start consistent saving habits from an early age. Lenders look for evidence of consistent savings over time, so make sure to put aside money from any working income, even casual jobs. Having savings in the bank when you’re ready to step into property investments can help you from feeling as though the goal post is out of reach. No matter what deposit you are wanting to take to the bank, to meet lenders guidelines you’ll generally need to show savings of 3% of your purchase price over a six-month period.

This helps your lender see clearly if you’ll be able to keep up the habit of consistent repayments in the future. Find yourself a budget and stick to it. Be prepared to give up a night out every month to cover your investment holding costs (outgoings minus incomings), but don’t forget to give yourself an allowance to have fun once in a while. Consider saving for your deposit while living at home, so you can still enjoy some disposable income.

You’ll also want to maintain a clean credit history by paying all bills or loan repayments. If you can’t make payments, make alternative arrangements with the creditor. A creditor may lodge a default against you on your VEDA Advantage personal credit file if your payments are more than 90 days late and alternative arrangements are not in place. Cutting or closing credit card balances - including Buy Now Pay Later services - is also a good step to take. Banks look at the credit limit on your cards, rather than the amount owing, because they want to know how much additional debt you could put yourself in.

####Find People Who Can Support You One of the key steps in investing young is finding the people that can support you throughout your journey, some of which could be very close to home. Your parents might be able to give you a head-start, helping with the deposit using the equity from their own property or acting as a guarantor on at least 20% of the loan. Otherwise, buying with a family member such as a sibling may help you break into the market sooner. But be aware that individual circumstances change and stamp duty will be charged if one buys out the other.

Before you even start investing, gaining knowledge and advice from Young Investors Club’s team of Property Experts can help you get started with the right mindset. You may not be able to afford a place yet, but that shouldn’t stop you from learning about the market, preparing you for the day you buy. Our Property Experts have years of experience managing their own property investments, as well as mentoring property investors along every part of their journey.

####Get Started On Your Property Investment Journey with Young Investors Club It’s never too early to start thinking about (and preparing for) your first property investment. Getting your start young requires dedication and vigilance, but can set you up for a comfortable retirement later on in life.

If you want to learn more about how Young Investors Club’s Property Experts can help you plan your way to your first investment, get in touch with us at enquiries@younginvestorsclub.com.au.