With housing prices still quite affordable in South East Queensland, there is plenty available for the savvy property investor; but if this is your first investment property, you may still be working out how to choose the best investment property for you.
Buying a investment property is very different to buying the home you will live in; you need to consider budget, how much you need to rent the property for, the location and the type of tenant you want. This is just the beginning!
We’ve put together some great tips to help you choose a good investment property.
4 Tips on Choosing an Investment Property
Choose a property that is likely to increase in value
It can be hard to know whether a property is going to increase in value – if only we could all see into the future! But there is plenty of data available where you can see past sale prices as well as recent sales prices in the area. There are so many variables to how quickly your property will increase in value. Many lenders and brokers have access to pricing data, so finding one you can sit and go through the data with before purchasing is well worth your time.
Budget and long term affordability
While people buy investment properties to make money, it’s generally not a short term investment. Make sure you do up a budget so you know what kind of rental income you need, as well as being able to cover the costs should there be a shortfall in rent. While there are tax deductions on many of the expenses involved in rental properties, it’s always a great idea to speak to an accountant before buying.
An understanding of the market
It’s always good to have an understanding of the market where you are looking to buy. Speaking to both sales agents and property managers will give you a good idea of areas that are desirable, areas they have trouble renting properties, or whether there is one street that is more desirable than another. It’s also a great idea to check if there are any developments or council works happening in the area which may affect your chance of renting the property.
Is the property attractive to tenants?
You could buy a top quality apartment right in the heart of Brisbane’s CBD, but is it attractive to the type of tenants you want? When choosing a property you need to take in location, available facilities (both of the property and the surrounding area), potential rental cost and maintenance costs amongst others. Finding a property that is close to all the daily facilities someone needs, as well as close to employment areas is always a good idea. If you do plan on renovating a property, remember to work towards the things that are important to tenants and not what you, as a property owner, prefers. This means easy to clean and maintain, enough storage space, natural light and functional living spaces.
Once you have chosen your property purchase, you will need to engage with a conveyancing solicitor who will look after the contract and sales process for your investment. Finding a good conveyancing solicitor can be the difference between a smooth property purchase and one filled with bumps and turns. Talk to the team at Salerno Law about your property purchase. With over 15 years providing legal solutions, including in property law, we can help your investment property purchase go smoothly.