39. Ensure you buy under market value
Buying under market value ensures you immediately get instant equity that you can then use to buy your next property. This also means guaranteed, instant profit.
Best of all, buying under market value lowers your risk. Say if you lose your job or got sick and unable to work, you will not lose money when selling your asset because you’ve already bought at a discount. The worst-case scenario would be for you to break even.
How I estimate/calculate market value:
- Look at comparable sales over the past six monthss
- Look also at the recent sales and what properties are on the market.
- Compare that with the asking price of the property you’re considering.
You need to make sure that you’re comparing like for like to establish the amount the market is willing to pay for similar properties. You can then use this figure to estimate the value of the property. Of course, you also need to bring in a professional valuer to ensure your estimates are correct and you’re truly buying under market value.