Warning: This gets a little long so unless your a newbie you probably wont want to read on. So i have a little bit of time on my hands tonight and i thought i might write up how i work a deal from begining to end that newbies may be interested in. There will be some variation on some deals but this is my basic outline when buying an IP. This is just one of many possible ways to approach it and everyone will have their own way/style which works for them. Below is just a rough example purely made up and not real numbers. The example is just to show 1 possible approach/strategy from many. Hope some find it useful. Scenario- Goal for next acquisition: Buy a house that has room to add value (via reno) to 10-12km from a CBD in a state thats cycle is 7-9 oclock. After reno, retain and extract equity to leverage into next IP. Chosen Area: Brisbane, Holland Park West, Strategy: cosmetic renovation revaluation to extract equity Due diligence: Use REA and Domain etc to research what renovated homes are selling for in the area, their land size, house size and amentities. After doing this research and talking to REAs you determine that newly renovated 3 bedroom homes are selling for 700-725k, renting at $620/week. You then research via same methoods above what older 3 bedroom comparable homes are selling for and you determine that their sale price is around 550-600k. Renovation feasibility: You then work out how much a cosmetic renovation might costs after speaking to a few companies, builders, tradies etc and determine that for a paint job,basic kitchen, basic bathroom , change floors, lighting and nice tapware comes to around 70k. You determine that after renovation costs, the margin between old and renovated 3 bedroom properties is worthwhile the effort to make it financially feasible. Renovation: $70,000 Holding costs:$4,000 ($2,000/month for 2 months) Stamp duty/legal:$20,000 Contingency: $3,700 (5% of reno+holding) Total: $97,700 Target: You then become totally obsessed with looking all over the suburb and close by for your target property at the price range around $550-$570k mark. Using websites, networking with agents, drive around etc you target not 1, but multiple properties that are acceptable and fit into your target, say 3. Dwelling Due diligence: Before calling agent, you use RP data to try and work up a vendor profile eg, what they paid for it, when they bought it, in how many names is the property, current rent (if rented) etc. Sometimes you are able to work out key motives by this process, eg, the place was bought last year for 620k and now they are asking 590k. Bells should start ringing at this point. So you do your DDD using rp data (or similar) on all 3 properties to get your vendor profiles. Sometimes it wont reveal much, and other times it will have useful infomation you can use in negotiations. Call agent: Introduce yourself, be confident, ask about the property and ask questions to try and work out the vendors motives for selling, let him/her know your a serious buyer who is ready to go, finance in place and if it can be bought at the right price you won't waste their time you'll just buy. Sometimes i like to give the impression i am buying with another person (so if need be i can make the partner 'look bad' in negotiations while i remain the good cop). The agent says that they are asking offers over 565k. You let the agent know that its above your budget and just wont work. Your able to make an offer of 550k. (There are so many different strategies/approaches to negotiate its impossible to write many of them here and it will also depend on the market how you will need to negotiate). The strategy i am trying to show here is that you make the same kind of offers on all the 3 properties, same approach to the 3 agents. Back and forth, back and Forth: Agent on property #2 says vendor counters and you accept a price of 560k. Property bought. House: $560,000 Stamp duty/legal: $20,000 Reno+HC+contingency: $77,700 Total: $657,770 Revaluation after Reno: $720,000 Rent: $620/week Equity increase: $62,230 You may be able to actually pull out 45-50k from that amount. Hooray! Now you have an IP that you added vaue to and is in great condition, increased its rent and its value, able to manufacture equity for your next IP deposit and its slightly Negatively geared only. I have used this basic framework (with some variations) many times with great results. Mission accomplished.