Buying your first investment property is a big decision, but costly mistakes are easily avoided with the right planning and guidance.
Your new property will be a long term responsibility for you and your family, so be sure to make smart choices right from the beginning. Here are five essential tips to help you make the best decisions.
1. Take The Time To Ensure Your Finances In Order
Whilst it is essential to spend time looking at potential properties and getting a feel for the market, you need to be certain about what you can afford before you get too excited about what’s available.
The real estate buying game requires expert advice and input from those who know the rules, who understand finances and those who will support you throughout this exciting journey.
A pre-approved loan can be a great way to know exactly what you have to spend before you browse. Be sure to read all the fine print about additional fees, taxes and interest rates.
2. What Is Your Aim For Your New Investment Property?
Take the old fashioned approach and make some notes about what your intentions are for the property you want to purchase.
Will this be a long or short term investment? Are you looking for something to renovate and sell for profit – or a low maintenance rental property?
Being sure of your aims will go a long way to helping you narrow down the best available options.
3. Investment Property Research
Preparation and research is essential before jumping into any purchase. Put a lot of thought into the location and buy in a sought-after area or one that has strong potential for growth.
Chat to local councils to find out their plans for future development or likely infrastructure improvements based on the changing lifestyles of the residents. Consider proximity to transport and local amenities, too.
4. Who Are Your Target Tenants?
In the case of rental properties, knowing who you are hoping to target as a prospective tenant will help narrow down your choice of location and property type. If you are hoping for families with children and you don’t mind a pet coming along for the ride, you’ll want a home or townhouse that is close to schools, parks and gardens.
If you are aiming for a professional couple, you may opt for an apartment style property in a restaurant or nightlife hub.
5. House or Apartment? New or Old?
There really is no right or wrong answer when it comes to selecting the best type of property in which to invest. It comes down to what you can afford, personal preference, location and the type of tenant you are seeking. Experienced investors also often opt for a mix of property types, in a variety of locations, to maintain a varied portfolio.
There are many things to think about when buying an investment property. Professional advice can be the best guarantee of avoiding regrettable mistakes. Seek help from those in the know – by asking the right questions, you’ll be empowering yourself and avoiding nasty surprises down the track.