Investing in property
has a lot of advantages, but, you should also remember that there are plenty of risks and pitfalls you need to be aware of. Some Australians are taking the plunge into investing without the proper knowledge or understanding of both in terms of their own goals and in terms of the property investing principles that will guide their asset’s growth.
Behind every successful property investor in Australia, there are landlords who are struggling to make ends meet, as they’ve invested a lot financially. Another possibility would be they have bought the wrong types of properties and they are not getting what they are expected to get in terms of the capital growth or profit.
Without an in-depth knowledge in financial and real estate, it’s impossible to learn the best strategies for increasing your wealth. Those who seek out expert advice first before they invest in property will be able to take the plunge safely, smartly, and with minimum risk.
It is highly recommended that you don’t attempt to step in to investing on your own. If you talk to experts when it comes to property investments, they could give you personalized and practical advice considering your own personal goals, budget and objectives.
Here are 5 Property investment tips we’ve collected from the experts:
Central and Popular Location
This is the first thing that you need to consider because a well-performing investment property is always located in a prime location. Choosing the best location is the key to your success. On the other hand, if you choose a location that is dependent on a single industry, chances are, it will also fail once the industry fails.
Is your investment strategy active or passive?
Next thing you have to consider before buying a property would be the time and money you want to invest in the asset on an ongoing basis. It’s not an easy set and forget kind of thing, because you will always need to be involved in every detail even if you appoint a property manager. However, leaving everything to your trusted property manager will demand less of your personal time and attention. So you have to consider this when you start planning your investment property.
- Buy a property in a desirable neighborhood
As mentioned in tip no. 1, the best location is the key to your success. Anybody would want a property that is accessible to public transports, hospitals, shops, restaurants, and schools. Another thing would be the crime and calamity rate of a location as this can influence the demographic of the area.
- Strong Rental Market
It all boils down to the natural influences of supply and demand. If a suburb has a low rental listing and vacancy rate, you will most likely want to invest in that area because the demand for rental homes is high. Generally, a rate above 3-3.5% is considered to be weak, so if the vacancy rate is high, this may affect your capacity to get a tenant which will force you to lower your asking rent.
- Seek the ability to add value
There are many advantages of investing in property, one of which is that you can use plenty of strategies to get ahead. Renovating your property is one way to add value to your house and increase rental returns. A simple renovation can do wonders to your property.
This article by no means covers everything you need to know when it comes to things you need to consider in investing in property. But this gives you a good starting point when you begin planning.