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Pay The Expert

Kiwis prefer a DIY approach in many instances, but when it comes to property investment it’s important to surround yourself with a group of experts, explains Peter Norris.

By: Peter Norris

31 March 2016

Unless you have studied law, accounting, real estate, property valuing and finance, chances are you are not an expert in all these areas - it’s even possible you aren’t an expert in any of these areas.

Don’t worry, you aren’t alone. There are plenty of people you can outsource this knowledge to; they are what I call your ‘tight five’.

Your ‘tight five’ are the people who you bring in to help make your investment goals a reality and, more than that, they ensure the journey to success is as smooth as possible. They have your back and they look after your best interests. Just like the ‘tight five’ in the All Blacks, these experts are on your team, fighting the same fight and chasing the same dream.

It’s likely that you’ve got a clear reason for property investing (especially if you read my last article) and what you’re in this game to achieve. But it’s possible you have no idea where to begin when it comes to bringing everything together to make this happen. That’s where your ‘tight five’ comes in.

Your ‘tight five’ should comprise experts in the following areas:

Lawyer: it’s likely this is the person to whom you pay the most fees, so choose wisely. The lawyer deals with more than just conveyancing. They need to be able to pick up potential issues in your deals and advise on whether you can make them work for you. The wrong lawyer can cost you, but the right lawyer can without a doubt save (or make) you money!

Accountant: don’t just look for the accountant with the lowest fees. Look for someone with property investment knowledge, who knows property structure and can advise you on the pros and cons of possible structures both now and in the future. Unwinding the wrong structure is expensive.

Real estate agent/property finder: no one enjoys going to auctions every weekend with every other man and his dog, only to be consistently outbid. Having a proactive real estate agent on your team is a bonus. Despite being one of the least trusted professions around, if your relationship is strong, they will let you know about potential deals before they go to market which puts you well ahead of the game and reduces your need to hustle with every other investor.

Property valuer: these days the banks have brought in third parties to manage the valuation process, so your ability to influence the valuer isn’t there. However, having a valuer in your tight five will protect you from spending more on a property than it's worth. If spending $500 on a valuation saves you $10,000 on a purchase price, then where’s the issue?

Mortgage broker/banker: this person is the glue. They need to know all the other four experts in your group and work closely with them through the process. There is no doubt the difference between approvals and declines (success and failure) can come down simply to who you are dealing with and how your application is presented to the lender. Whether you’re dealing with a broker, or direct with the bank – and neither is right or wrong – make sure they understand investing and more importantly, they understand what you are trying to achieve. These guys represent you so don’t underestimate the importance of choosing wisely.

Many other experts will come in handy now and again, but the aforementioned five will be there through your whole journey and, if you choose correctly, they’ll get you to the end goal faster. There’s a reason the majority charge so much – it’s because we need them. And the right ones are worth their weight in gold, so don’t be afraid to pay your expert.

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