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Do you review your property portfolio?

Discussion in 'General Property Chat' started by MTR, 2nd Sep, 2015.

  1. MTR

    MTR Well-Known Member Premium Member

    Joined:
    19th Jun, 2015
    Posts:
    7,299
    Location:
    Perth, Melbourne, USA
    Regardless of your strategy I think this is a big one.

    When I started investing, I never ever did this, I just continued to accumulate blindly, until I finally had no choice and took control of the beast:)

    Obviously we are now seeing some changes in the market?? no one rings a bell when the market peaks.

    Do you have any underperformers?
    Perhaps selling the property is an option, or maybe you are willing to ride it out a little longer.
    I would do your calculations around what your bottom line looks like with both your underperformers included and the money redirected elsewhere.

    Are you achieving your goals?
    Are you goals on track??? If not, why not? What went wrong or changed?

    Has your lifestyle changed, or is likely to change in the future?
    How this will impact on cash flow. Obviously some things will be out of our control, no crystal ball unfortunately.

    Can you move your portfolio ahead more quickly?

    Explore all options, ie Accessing equity, selling down to reinvest in other asset classes with higher yields, using equity to renovate/adding value etc.

    Risk mitigation?
    Do you have financial buffers in place? Will you be able to ride a property crash if you can not sell?
    Do you have the right professionals to guide/provide the right advice ie structures, taxes, insurance etc.

    Please feel free to add to the list that I may have missed.

    MTR:)
     
    MJS1034, Redom and Perthguy like this.
  2. Perthguy

    Perthguy Well-Known Member

    Joined:
    23rd Jun, 2015
    Posts:
    4,671
    Location:
    Perth
    Always good to review a porfolio regularly. Keeping on top of property values is important if you want to access equity. It's also good to keep track of your overall LVR if you want your money to work for you. I didn't watch mine for a while and it got down to 55%. Not good during the accumulation phase!

    Something else to review is position to improve values. Two examples. At the end of a tenancy, see if there are opportunities for improving the property to increase rental returns. I did this on one IP and increased the rent from $320 pw to $440 pw. The other is development opportunites. If you have multiple development sites, in different areas or different states, you need to be across market movements, rental values and demand to know which site to develop when the opportunity arises. If you are not reviewing your portfolio regularly, you won't know this.
     
  3. Redom

    Redom Mortgage Broker Business Member

    Joined:
    18th Jun, 2015
    Posts:
    853
    Location:
    Sydney (West) and Canberra
    Great post MTR - i often encourage those that can purchase multiple properties in short periods if they chose to, to review after each purchase. The balance of the portfolio slightly adjusts after each purchase, so it does make sense to review and tweak strategies - often allowing better focusing of 'what i need' for the next purchase.

    Glad you included risk mitigation factors, often overlooked. One that i'm glad more and more people with growing portfolios are starting to acknowledge is the potential for interest only terms on loans expiring and financing options to extend being more uncertain with APRA in the mix.

    Cheers,
    Redom
     
    MTR likes this.
  4. 2FAST4U

    2FAST4U Well-Known Member

    Joined:
    3rd Jul, 2015
    Posts:
    913
    Location:
    Adelaide
    I'm using a buy and hold strategy with development in the future so currently it is set and forget.
     
  5. HD_ACE

    HD_ACE Game-Changer Premium Member

    Joined:
    18th Jun, 2015
    Posts:
    449
    Location:
    Perth
    I review mine annually. Which includes talking to other professionals in regards to values, sales and suburb performance. Also with my pm's regarding market rents and demand etc which is good to know before a lease is coming up for renewal so the opportunity can be used to renovate or develop.

    Also if favorable, get upfront vals and draw equity where I can to sit on it for future buys or development funding.Pretty standard stuff.

    Apart from that let the portfolio do it's thing.