Top 4 Reasons Why You Need to Carry Out an Annual Portfolio Review

Building a lucrative property portfolio can take plenty of time and effort, so it may be tempting to think that once you’ve established one, the job’s over with. In fact, the most successful investors conduct an annual portfolio review to make sure their portfolios continue running like a well-oiled machine. Here are four good reasons why should do the same. 

Access further equity

One of the most advantageous features of investing in property is the fact that it’s a direct route into further real estate investment. The equity you hold in your portfolio can be leveraged to borrow for another property, further growing this equity and continuing the cycle. By conducting an annual portfolio review, you’ll know if you’ve built up sufficient equity in one or more of your assets in order to purchase another property, and can start putting your plans into motion.

Restructure your portfolio

Even if your portfolio as a whole is doing well, that doesn’t mean every single property is performing to your preferred standard. One or more properties could be seeing stagnating growth, while others might not be delivering the same kind of rental revenue as they were before. Through an annual review, you’ll be able to identify any potential issues and discuss solutions to address them. 

Revise your finance

Any mortgage expert will tell you about the usefulness of re-examining your financial structuring. Refinancing a home loan to take advantage of recent interest rate cuts, for instance, can save you thousands of dollars. You can also restructure a mortgage to insulate yourself from changes in your financial circumstances, such as by splitting your home loan between a fixed and variable rate. The ultimate goal is to make sure your rental income continues to offset the expense of your own home mortgage, so incorporate this into your annual portfolio review.

Ensure you’re on track

No one should start building a portfolio without a cohesive property investment plan in place. This plan should be based on a concrete goal that you want to achieve through investing – saving for retirement, for instance, or making enough to open and run a business. Your annual review will let you see if you’re still on track for meeting this goal and, if not, why and how you can change course. If your goal was more tentative when you began, then this could be an opportunity to clarify it. 

Source: DPN

Ready for a portfolio review? Get in touch with Simon from Metcalfe Real Estate today.

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0474 773 034