Purchasing investment properties is still by far one of the most popular ways for Australians to invest their money. Investments properties should be about providing you with financial security, but there is a common misconception that buying investment properties will always yield a positive return. While this is true in most cases, it is still essential to take the right precautions to protect your investment. Below are a few hints and tips to help you on your road to property investment success.
1. Buy the Right Property at the Right Price
Investing in property tends to be about capital growth, which is why it is crucial to choose properties that are likely to increase in value over time. A good way to determine whether a particular property will be a wise investment choice is to see what other properties in the immediate area have sold for over the past few years. This will enable you to take advantage of a true bargain when it comes along. Never ever be coerced into purchasing a property in an area that you are unfamiliar with – regardless of how much of a ‘bargain’ it seems to be.
2. Know the Market where you are Purchasing
Take a look at other available properties in the immediate area where you are considering purchasing, and also speak with as many locals and estate agents as possible. In most cases, they’ll be more than willing to let you know if one part of a suburb is considered better than the rest. It is also recommended that you access independent data from sources like RP Data, as this will provide you with information pertaining tp average property values, rental prices, general suburb reports and even demographics of the area you’d like to purchase in.
3. Inspect the Property Thoroughly
Even if you obtain a property at a bargain price, the cost of replacing a hot water system or doing major roofing repairs can have a significantly negative effect on your cash flow and overall profit. As a result, it is essential that you enlist the help of a qualified and experienced building inspector to thoroughly check each aspect of the building before you purchase it. Although you can score a bargain if a property requires a few repairs, these should also only be done by licensed, qualified and experienced tradespeople.
4. Make the Property Attractive to Potential Renters
Before putting your investment property on the rental market, ensure that all fixtures are in good working order and that the home looks attractive overall. A fresh coat of paint and a thorough cleaning will also go a long way in ensuring that you attract decent renters. A great rule of thumb when doing property repairs and upgrades would be to ask yourself if you would be happy living in the property if it was in its current condition.
If you would like ot find out more about having a pre-purchase inspection or termite inspection performed before buying a property, get in touch with us to schedule one today.