The investor’s big three

When consulting with an estate agent about the management of their property investments, most novice investors focus on short-term return.

“They want maximum income, minimum expenses,” Bellarine Property managing director Christian Bartley said.

“Most new investors are borrowing money and they and their managers become obsessed with immediate return because it’s often crucial to the ongoing survival of the investment. Stated simply: no rent = no income = no loan repayments = no investment.”

According to Mr Bartley, experienced investors have three main aims: optimum income, optimum expenses and a focus on capital appreciation. They choose an agent who will optimise their income-to-expenses ratio over the long term and who has expertise to look after the big picture.

“When the floor coverings in an investment property need replacing, buying the cheapest carpet will certainly minimise expenses at the time of expenditure. However, if the carpet doesn’t wear well, the saving may turn out to be less cost effective in the long term than a carpet that was a bit more expensive but lasted twice as long.”

He said long-term successful investors employed property investment managers rather than property managers so that long term and shortterm goals were merged into an overall strategy.

“Capital growth is the culmination of the investor’s big three and it is often overlooked by property managers with a narrow focus on management rather than investment. If investors hold their property for any length of time (which most successful investors do) capital growth becomes the most wealth producing part of the overall investment equation.”

Phone Christian Bartley on 0410 695 325, email [email protected] or head to bellarineproperty.com.au.