Planning to invest in property? Follow this expert advice from our friends at Mortgage Choice to ensure you make the right choices.
Investing in property is an exciting and potentially life changing decision. Assuming that the right choices are made from the beginning, property investment could put you in a better financial position in the long run.
Once you have done your property and mortgage market research, established how much money you can afford to spend on a property and have worked out your investment strategy, you can begin your search to find an investment property.
Borrowers should keep in mind though that searching for the right investment property calls for quite a different approach when compared to finding your dream home.
When choosing your dream home, for example, you might look in more detail at how the house will best accommodate you and/or your family by looking at the number of bedrooms or its proximity to your place of work, schools, other family and friends, etc.
On the flipside, as the landlord, you need to think less about your own property preferences and more about your potential tenants’ wants and needs. Think about the kind of tenant/s you want to attract to your investment property, and use this to help you hone in on the type of property and property features that would be desirable for these potential tenants.
Keep in mind that tenants can be very picky about what they are getting in return for their rent payments, so look at your potential investment property with an objective eye and consider what it offers that other similar properties may lack.
Location is a key driver when selecting an investment property, so aim for the best location that you can afford. One offering good transport links and proximity to outlets such as shops, restaurants, parks, schools and even hospitals, would be ideal.
Ensure that you research locations carefully, taking into consideration all of the important factors including, but not limited to, population growth, tenant demand, local price growth, developments planned for the area in the coming years, etc.
It is also critical to think about the type of property that is best suited to your investment strategy. For example, there may be government grants or concessions on offer for purchasing a new, as opposed to an existing property.
To help give you a kick start, here is a list of ‘must-have’ features that you might like to consider when looking at potential investment properties.
Security – Whether it is a safe, quiet street with good lighting or a home security system, just like you do in your own home, your tenants will want to feel safe in theirs.
Parking – Believe it or not, off street or undercover parking could add value to your property and attract a wider range of tenants.
Tenant appeal – In order to maximise your rental return, look for properties that will appeal to your ideal tenant. Why not give the house a little more aesthetic appeal with a fresh coat of paint, or by putting new handles on the kitchen cupboards – every little bit helps!
Storage – Ample storage is a plus for tenants who may only be staying for the short term or who may otherwise have to pay for off-site storage. Plenty of storage facilities could also help to ensure that the property remains well-kept.
Low maintenance – Stick to properties that can be easily and cheaply maintained on the tenant’s behalf, as they are more likely to prefer low maintenance homes that will not require a significant investment of their time for upkeep.
For more information, contact Mortgage Choice on 13 6678 or go to www.mortgagechoice.com.au.