When you plan to acquire a property investment, the common rule is to base your buying preferences on your objectives, and not merely on your emotions. After all, you will not be actually living in that property.
It is also important to consider the financial capacity of the property, evaluate if the price is good enough, and determine how much the returns would probably be, including the rental vacancy rate and property rental incomes.
In the real estate market, property prices and interest rates are low. In addition, with property rentals looking great, it only shows that property investment is a good move and to change that, it will require interest rates and prices to change as well.
Renowned mortgage experts emphasised the importance of extensive research before investing on a property from a certain area. Investors must consider some demand aspects. Like for example, in Western Sydney, terrace houses are more in demand than apartments. So if you are looking for a probable investment, consider those that are currently in demand so you are rest assured of a profitable business.
If you are quite apprehensive about the latest market trend in real estate, it would be ideal to ask some advice from property managers within a given area. Ask what types of properties are in demand, and then weigh things up based on the law of supply and demand. It is essential to purchase something that is currently low in supply but highly in demand.
Other considerable factors are properties that have good access to shops, public transportation, or spacious parking lots, consider a property that has a flexible and functional floor plan. If you are planning to buy a property within the city’s vicinity, then consider the accessibility to schools, hospitals, and other essential community public facilities.
Your expenses like the strata fees must also be considered in buying a property investment since these can eat up a big chunk out from your profits. Let’s say, you purchased a small block-type property, fees could be around $650 or so per quarter. This is way cheaper than a property block with a gym, swimming pool, and concierge, which will cost you a strata fee of around $1500 every quarter.
Apparently, expensive blocks will have higher rental charges, not everybody can afford such fees. And if the property is not generating a profitable income for a long period, it would be very hard to cover up the charges on your end.
Obviously, every property owner does not want high maintenance and operational expenses. It is therefore important that you try to visualise what would most likely happen with your investments during tight times. You have to understand the entire area of your preferred property. Just because one property is in demand on a certain area doesn’t necessarily mean that it can be extensive.
So don’t fall right away for properties with beautiful picket fences or a bedroom with its own personal bathroom – these amenities will not get the greatest yield. What really counts is purchasing a property at a good price, probable high income generating, and incurs reasonably low operating expenses.
If you are unsure on what action to take, seek some advice from your Rockingham Mortgage Brokers.