Investing in property is a good way to start the year. But as with anything, there are certain important factors to consider before you dip your toe in the investing water. Whether you’re an existing investor or a first home buyer, doing your research and planning are vital to your success with property investment.
First on your list should be to determine which area you would like to invest in. In Australia, there are many areas to choose from including mining areas, coastal towns and rural towns, with differenty types on offer in each, from student accommodation to houses and inner city units.
Metropolitan Areas
If you prefer to invest near major cities, finding an investment in popular suburbs is recommended.
Many couples and families looking for a new home will consider more affordable areas, such as Melton West, considered to be Melbourne’s most affordable suburb followed by Werribee. A 2014 report from Real Estate Institute Victoria (REIV) noted that the median price in Melton West is $270,000, with Werribee homes at just over $300,000.
These areas are easily accessible to public transport, schools and lifestyle facilities making them popular with renters. With such affordable entry price points to buy into the market, depending on the rent they will return, they may prove to be viable areas for investing, but do your homework first. You may achieve an equally solid return by buying a house closer to the city that will yield a higher rental return. Crunch the numbers to see what works for you.
Those looking to invest near the city centre may consider buying an apartment in inner city high-rise residential buildings. There are plenty to choose from, from central Melbourne CBD, Docklands and Southbank to inner city suburbs such as Brunswick, Flemington and South Melbourne. Many offer top quality amenities and can be attractive to investors, where stamp duty savings are offered, but be aware of the saturation point in any suburb when it comes to apartment stock.
Too many properties on the market, be they for sale or for rent, will affect the resale value or rental yield that you may be able to achieve if you choose an apartment as an investment.
Student Accommodation
Investors including the first-timers may also consider investing in student accommodation which does not require huge capital to get started.
Whilst they may be a cheaper form of investment, student accommodation often comes with strict rules as to who can live there. The size of the apartment itself can be problematic if it falls below the size criteria a bank will look at for financing. Plus you will be reliant on the peaks and troughs of the student market.
This type of investment property may not attract long-term tenants and when you do decide to sell, you need to find a buyer also willing to purchase based on the same rules as above, which will reduce your pool of investors willing to buy this type of accommodation.
Looking to buy in Melbourne and sick of missing out at auction? Talk to me about how I can help you buy your new home faster, for less.
Give me a call on 03 9686 2288 to discuss how I can help. I offer a free consultation, so why not call today?
By Wendy Chamberlain
Copyright 2017 | All Rights Reserved
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With a passion for all things real estate spanning 18 years, Wendy loves that her role as a Buyers Advocate gives her buyers an experienced voice they can trust when it comes to negotiating to purchase something as important as their new home or investment. Wendy considers it a privilege to be asked to help others realise such an important goal as home ownership and to be trusted with that honour. Get in touch today via www.FollowWendy.com for a no obligation chat about how Wendy can work with you and help you save time and money to secure your new home sooner.
