Property advice to hit the ground running when making your move

Real estate buyers, sellers, owners or investors can ensure a smooth 2021 with some personal reflection and number crunching.

Opinion: You’ve got to admire skilled skydivers who can hurl themselves out of an aircraft 4km above the ground and land with a casual jog on the exact spot they aimed for.

They often have to deal with changing wind conditions but still manage to hit the ground running.

Several years ago I tried skydiving, and my landing involved sliding on my backside ingloriously for a few metres.

Taking the plunge with property has some similarities with jumping out of a plane – an adrenaline rush, fear of the unknown, and learning new lessons and skills.

If you’re thinking of making a real estate move in 2021 – either buying, selling or investing – there are several ways to make sure you hit the ground running.

HAVE AN EXIT PLAN

Anyone buying or owning real estate should have a rough idea about how, when and why they will eventually sell.

Knowing if you plan to hold a home for years or decades is a great idea and will help avoid costly decisions caused by knee-jerk reactions around price moves, interest rates or renovations.

Plans can change, of course, but it pays to have one even if you’re a long-term owner.

Some parachute landings, like some property moves, are smoother than others.

KNOW THE MARKET

If you’re an owner-occupier, landlord or tenant, try to have a good grasp of where home values or rents in your area have been heading.

Then, if you need to make a quick decision, you can react in an informed manner rather than rushing into it willy-nilly.

It’s easier than ever to find data on prices, rents and recent sales on websites such as realestate.com.au.

GET FINANCE SORTED

Buyers who have their money organised before they bid will find purchasing real estate much less stressful.

Talk to your lender or mortgage broker about seeking pre-approval for a home loan. It’s a good process to go through to ensure you won’t stretch yourself financially when interest rates eventually rise.

And try to have a back-up plan to cope with a financial crunch if you suddenly lose income. Equity in a home that can be accessed through an offset account or redraw facility is a great safety net to create as quickly as possible.

THINK TAX TODAY

Tax is a vital part of property investment and shouldn’t be seen as something to put off until June.

Investors can deliver themselves some handy deductions by spending on maintenance and repairs before the end of the financial year or considering prepaying insurance or interest. And always know the capital gains tax impacts when planning to sell.

Owner-occupiers should consider capital gains tax issues too if they’ve ever rented out their property, or just rented a room or two through accommodation sharing websites such as Airbnb.

The taxman is watching and tracks millions of transactions electronically.

Just like my skydiving experience helped me understand how planes fly – air is a lot more solid than we think when you’re plummeting through it – real estate experiences over many years have shown that property isn’t something you should just throw yourself into.

@keanemoney