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Picture it. After years of saving and working hard, you've got together a deposit and you're in the position to buy an investment property. All the discipline you've exercised, all the sacrifices you've made have finally paid off and you're close to achieving one of your major life goals. And … it's terrifying.

Suddenly all you're hearing are horror stories about people who bought the 'perfect' asset, only to uncover a termite infestation the day after settlement. Or that one rental property that lost 50% of its value within two years of an investor buying it.

When you've worked this hard, it's easy to see how the pressure to make the right call on what property to actually buy can be overwhelming.

This is something Junge Ma, Senior Research Analyst at buyer's agency InvestorKit, sees "constantly".

"It's very common for our clients to know they want to invest in property, but they don't know what to buy and why, nor where to buy it," she told Your Mortgage.

"Being a significant financial investment, it's all too common for buyers who are trying to do it themselves to be experiencing high levels of fear, uncertainty and doubt."

We spoke to Ms Ma about how 'Analysis Paralysis' manifests in budding property investors and how best to overcome it.

Read more: Pros and cons of property investing

What is analysis paralysis?

Definition

Overthinking, paralysis by analysis, indecisiveness; these are all ways to describe the same thing - being so scared to make the wrong decision that you end up not making one at all (or at least not acting in time).

It's a phenomenon that's probably been around for as long as people have.

Aesop even wrote a fable about a fox who boasts to a cat about the many ways it knows to get away from a pack of dogs. The cat is embarrassed to admit to only having one escape route (running up a tree). When push comes to shove though, the cat runs straight up the tree, but the fox spends too much time deciding what to do and is caught by the hounds.

If you fall victim to analysis paralysis for property investors, you probably won't get eaten by dogs. You might miss out on some big opportunities, though. And if you wait too long, before you know it property prices could be far higher.

Per the most recent CoreLogic Home Value Index, property prices in Australia rose 12.5% from May '23 to '24. A budding investor 'paralysed by analysis' last May is likely to now need to pay much more than they otherwise would have.

What property investors get hung up on

There's all sorts of information out there on property investing and the market, which is definitely a good thing. At the same time, Ms Ma says it can be overwhelming for some people.

"The sheer volume of competing advice that is out there about the different markets to buy in, the various types of property you should invest in, and the strategies you should follow … buyers become even more confused," she explained.

"Clients can be indecisive on location, house size, house material, house condition, current rental yields, holding costs such as land tax and insurance fees, etcetera."

She says its understandable for investors to try to analyse everything to find the perfect house, but that such rampant overthinking can be the root cause of analysis paralysis.

"Over analysis occurs when you strive for the perfect house and start adding more and more non-essential requirements to your checklist, such as a good school zone, proximity to shopping centres and development potential," Ms Ma said.

"These non-essential requirements don't necessarily make an investment more successful - instead they can cost you opportunities and slow down your investment journey."

How to avoid analysis paralysis

Clearly, buying a property without doing any research at all isn't a great idea. Still, Ms Ma says there are some essential requirements for a successful investment that you should make sure you tick off:

  • A healthy local economy

  • The right market pressure

  • Alignment with your investment goals

  • Passing due diligence tests (tendency to flood, for example)

  • Passing building and pest inspections

While there are plenty of other factors to take into account, she says these should be the only non-negotiables .

If you're hesitating to pull the trigger and buy an investment property that's perfect, except for the fact it's a fifteen minute drive from the nearest train station, you might be suffering from a case of analysis paralysis.

Some people who are hesitant to buy might not even have a specific concern. Rather, a more generalised anxiety about such a major financial decision, which again, is fair.

If this sounds like you, Ms Ma has a few questions that you should ask yourself:

  • What is my investment goal?

  • What is the concern that's preventing me from making this decision?

  • Will that concern hinder me in reaching my investment goal?

  • What is the worst possible outcome of this decision and would I be able to deal with it?

That last question is particularly important.

As with any investment, buying a property isn't risk free. There's always a chance that your fears will be realised and things won't work out, regardless of how well you prepare.

Providing you do your due diligence on pests and the likelihood of natural disasters, though, the worst possible scenario is probably your investment property falling in value or not meeting your cashflow expectations.

That would suck, for sure. But it likely wouldn't be life-defining.

You'll probably learn some valuable lessons for next time and you'll still have equity in a property, which comes with plenty of advantages.

If worst comes to worst, chances are that your 'failed' investment would eventually become a funny anecdote. So don't let analysis paralysis hold you back.


If you're pumped up to buy a property of your own, these are some of the top home loan options on the market at the moment.

Update resultsUpdate
LenderHome LoanInterest Rate Comparison Rate* Monthly Repayment Repayment type Rate Type Offset Redraw Ongoing Fees Upfront Fees LVR Lump Sum Repayment Additional Repayments Split Loan Option TagsFeaturesLinkCompare
6.19% p.a.
6.58% p.a.
$2,589
Principal & Interest
Variable
$0
$530
90%
Featured 90% LVR
  • You MUST already have Solar or a documented plan to install within 90 days to be eligible for this loan
  • Available for refinance or purchase
  • No monthly, annual or ongoing fees
6.19% p.a.
6.19% p.a.
$2,447
Principal & Interest
Variable
$0
$0
60%
6.24% p.a.
6.46% p.a.
$2,460
Principal & Interest
Variable
$15
$250
60%
6.29% p.a.
6.20% p.a.
$2,473
Principal & Interest
Variable
$0
$0
80%
6.29% p.a.
6.30% p.a.
$2,473
Principal & Interest
Variable
$0
$180
80%
6.39% p.a.
6.43% p.a.
$2,499
Principal & Interest
Variable
$0
$595
80%
Important Information and Comparison Rate Warning

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. Some products will be marked as promoted, featured or sponsored and may appear prominently in the tables regardless of their attributes. All products will list the LVR with the product and rate which are clearly published on the product provider’s website. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of .