Finding a great investment property requires discipline and due diligence around the organisation of your finances. You have to be on top of your mortgage and tax obligations, as well as potential income and tax benefits from negative gearing and write-offs. Seeking professional financial advice is a great first step to avoid any unforeseen costs.
Picking the right property to invest in requires an equal if not more amount of attention than buying a home. Before purchasing your investment property, it is crucial to figure out your expected financial benefits before purchasing one. Are you seeking an outright profit from day one, or is the purchase strategic to minimise tax? Perhaps you would like to develop a long-term wealth portfolio?
To help you in your search, here are nine critical considerations when deciding on an investment property.
Investment Tip #1: Vacancies
Research the number of vacant rentals around your target area. This may indicate if there’s a demand or an oversupply in the area. In other words, try not to pick an area with low demand and an oversupply or somewhere that doesn’t attract good quality renters.
Investment Tip #2: Rental Rates
Compare the rental rates for similar properties in the area. You can also request a rental appraisal from your sales agent prior to purchasing the property. That way, you will have a rough idea of your returns.
Investment Tip #3: Future Developments
Are there any significant developments about to come on to the market? If so, what type of developments? A release of several hundred apartments places pressure on rental incomes which can result in a short to medium-term fall in values.
Investment Tip #4: Employment Opportunities
Areas with readily available work are excellent locations. Therefore, picking an area with local employment opportunities is beneficial. If there is a casual workforce and strong hospitality, the area will be great to invest in! This is usually evident in tourism centres and university towns.
Investment Tip #5: Entertainment
Location close to cafes, restaurants, and movie theatres will attract young professionals as tenants. That is why researching your surrounding amenities is so important to target the right demographic for your investment property.
Investment Tip #6: Neighbourhood
Know the neighbourhood as the locality will influence the type of renter. Locations near a university will usually attract students and lecturers. In addition, surveying the type of restaurants nearby could be a good indicator of the area’s demographic.
Investment Tip #7: School
A rental property near a school is an ideal investment property, especially if you’re thinking of investing in a house. Families who rent are usually longer-term tenants which mean less paperwork and fewer vacant days.
Investment Tip #8: Crime Rate
Seek advice from the local police or check the internet for local crime statistics. Crimes such as vandalism and petty crime can drag down the value of your investment and diminish rental returns.
Investment Tip #9: Council Rates
Check on council rates in your favoured locations. You might be surprised at the difference from one council area to another.
Calibre Real Estate
Purchasing an investment property can be a daunting experience. Here at Calibre, our team of experienced Sales Agents are ready to lend a hand.
Get in touch with us on 07 3367 3411.
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In Summary
How To Find Your Ideal Investment Property
- Vacancies
This may indicate if there’s a demand or an oversupply in the area. In other words, try not to pick an area with low demand and an oversupply or somewhere that doesn’t attract goo
- Rental Rates
Compare the rental rates for similar properties in the area.
- Future Developments
Are there any significant developments about to come on to the market?
- Employment Opportunities
Areas with readily available work are excellent locations.
- Entertainment
Location close to cafes, restaurants, and movie theatres will attract young professionals as tenants.
- Neighbourhood
Know the neighbourhood as the locality will influence the type of renter.
- School
Rental property near a school is an ideal investment property, especially if you’re thinking of investing in a house.
- Crime Rates
Seek advice from the local police
- Council Rates
Check on council rates in your favoured locations.
