Tips for the final purchase decision!

We answer these and many other questions in our video blog episodes.

Here is the transcript of episode 23 to read through:

Once everything has been professionally sorted out and you’ve chosen a property using the checklist – with professional advisers by your side – and everything fits and has been worked out, the day will come when you have to make your final decision. In my experience, there isn’t a single property in the world where everything fits perfectly 110 %. You’ll always have to make a compromise. The challenge is to find the smallest possible compromise.

Here’s an example I’ve come across many times in my own property purchases: I’ve got a brilliant location, a profitable property where everything is just perfect – the story, the property, the figures, everything ticks all the boxes. And then I sell 20 flats in that building at that location, and at some point a client says to me: “Martin, everything’s just right… But the flat only has a north-facing balcony.” In such cases, I’ve often dealt with it by buying the flat myself if the customer doesn’t take it because of the balcony. That’s always paid off for me, because there’s no such thing as a ‘jack-of-all-trades’. You’ll never find a property where everything is 110 per cent perfect. You’ll always have to make a compromise.

The most important thing in life and with a property is that you get things moving, that time works for you and that the tenant pays off the property for you every month. So if you have the right property, but the balcony faces north or something minor is still missing, you shouldn't underestimate that. It would be fatal to wait two years to supposedly find a better property.

Because in these two years, purchase prices have already risen due to inflation. That means you've missed out on 24 months in which the tenant would have paid off the property for you month after month.

Let’s say the tenant pays €750 in rent per month – that’s €9,000 net per year – and you’ve missed out on two years’ rent; that’s €18,000 in lost rental income! You’ll have to make up for that later. This means it will take longer to pay off the mortgage. You’ll be older by the time the property is paid off. So look for a perfect, great property, but don’t look for one where everything is just right – where it’s 110 per cent perfect. That’ll never happen. You’ll always have to make a small compromise. And if you do that, you’ll be well on your way.

Keywords:
Property, compromise, checklist, rental income, time, balcony, financing