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On this day TV we caught up with Nathan Birch investor for his investment advice. First of he took 3 months’ tabs.
There is 3keys to while I am purchasing a property, they are very important to make a deal work or not work, if maybe any of this are not click I may buy the property.
1. Making sure that I buy the property below market value, this gives me equity from day one and also give me an extra strategy and a buffering place incase anything goes wrong, you might be losing money and the worst case scenario you don’t make any profit.
2. I look forward when purchasing a property is that I want to make sure it got strong cash flow, that is not eating into your last day expenses. What’s very important when buying a property, is that it is going to help you achieve your goals and make money. A lot of people go out there to just buy party and dealing day in and around that is going to be causing them money, each week or so. Our dealing property will be positive cash flow, if worst case it will be neutral cash flow.
3. The third I look for in buying a property is that it has outside for capital growth, what I am going to make sure someone bought a $200000 property you in 10 years’ time it’s going too worth at least $400000 or $500000. It going to have room to grow, because if you buy a property that’s is not going to grow up in value, you wouldn’t make a lot of money in capital growth.
Birch said he does have a system that allows him to quickly analyze the profitability of the deal but also a large part if it is keeping you top of the system.
Quite a lot of people ask me Nathan, do you have any sort of cheap cheat or strategy of working or analyzing whether a deal work or not. For me there is a few things that I keep in boxes, but now I want to make sure the property got at least 7% yield depending whether it is at the metro area or region area.
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