A buffer is a tool used by many sophisticated investors to buy time.

Understanding what your holding costs will be and then creating a buffer to get through the next 3 – 5 years.

For example, a $30,000 buffer may get you through the next 3 years if your holding costs are around $10,000 per annum or 6 years if they are $5,000 per annum.

Rather than borrowing to the max, a beginning investor could look at reducing their budget or purchase price and allowing some funds for a buffer.

Existing investors may choose to use their savings or look at refinancing and using a portion of the equity to buy time and fund the shortfall.

A buffer can also be a great risk management tool when preparing for a recession, or a GFC type of event because something unexpected will happen at some point in the future.

It is about preparing for the worst and hoping it never happens, rather than the other way around.

RealRenta has all the tools that a property manager has but for less than ¼ the cost of a property manager.

Join now and the cost is less than a cup of coffee a week to manage your rental property.

RealRenta also has a free vision, so why not check it out.

Jason Gwerder
Tuesday, 1 August 2023

Join our mailing list Receive Free Property Tips and news

Now Partnered With


Contact Us

1300 11 RENT (7368)