Investing in property for the first time can feel daunting. If you make the right choice, your investment property can provide you with a second income stream for life. Poor decisions, on the other hand, might see you taking on unescessary overheads that will haunt you for a long time.
Before you sign on the dotted line, here are four tips from Rosie & Rosie to help you make the right investment.
In almost all cases, the rental income you receive from your new investment property won’t cover all of your costs. And while those costs are tax deductible, it’s worth knowing how much you can afford to invest each week.
Add up the mortgage repayments, utilities, landlord insurance, building insurance and any strata or unit costs, as well as the cost of hiring a property manager. Don’t forget repairs, which are an inevitable cost of owning property.
When you know how much you can afford to contribute, you’ll have a clearer idea of your budget before looking to buy.
Good real estate agents maintain strong databases with lists of prospective buyers and what they’re looking for. That’s an advantage for sellers, because when a new property is listed it allows the agent to go to the right people first, before it goes to the open market.
If you’re a buyer, it’s worth getting your name on those lists. Find a qualified agent, who’s active in your desired area, and have a conversation with them about what you’re looking for. You’ll have access to quality investment properties before anyone else knows about them, and you can benefit from their expert advice early on.
Consult with a financial professional, too. They can help you understand what is and isn’t deductible, which is useful if you’re planning to look at properties you can renovate, and help you get a clearer idea of your budget.
Keep in mind that just because you like an area doesn’t mean that it will appeal to your potential tenants. If you’re buying to invest, it’s good strategy to look in popular locations.
Look at the rental demand in various areas around the city or town in which you’re planning to invest. Make sure there is a nearby town centre, public amenities and high levels of employment.
Consider your specific market, too. If you’re buying a family home, you want to be able to advertise proximity to local schools, public transport, parks and libraries. A tenant renting a studio apartment is more likely to appreciate nearby cafe strips and an easy commute to the CBD. Properties near universities and colleges are likely to appeal to students, while retirees want easy access to shops and doctors, and well maintained streets.
A buyer’s agent like Rosie & Rosie can be invaluable for a number of reasons. Firstly, they’re removed from the emotion of buying a house, and can assess your opportunities logically and rationally.
Most people buy and sell property three or fewer times in their life. By contrast, a buyer’s agent does so for a living. As a result, they can bring experience and reliability when it comes to dealing with real estate agents and vendors. Their negotiation skills and knowledge of the market are indispensable when it comes to settling on a desirable purchase price or rental.
Combining our knowledge of property trends, analysis of the latest property data and extensive network of industry related professionals, at Rosie & Rosie we will work with you collaboratively to achieve your personal property investment goals.
For further details, contact Rosie & Rosie at http://rosieandrosie.com.au/contact/