Finding Your Ideal Investment Property
An eight-point strategy to help you navigate the search
Finding a promising investment property requires due diligence and a serious amount of discipline around the organisation of your finances. You will need to be on top of mortgage and tax obligations, as well as potential income and tax benefits from negative gearing and write-offs. When considering purchasing an investment property, it’s crucial to focus on the anticipated financial outcomes. Do you aim for immediate profitability, or is the purchase strategically aligned with tax minimisation and long-term wealth development?
To help you in your search, here are eight critical considerations when deciding on an investment property:
1. Vacancies – Always look at the number of vacant rental properties in your target area. You don’t want to invest where there’s an oversupply or somewhere that doesn’t attract high-quality renters.
2. Rental income – Compare the rents being asked for similar properties. Can you make your numbers work at the current rate?
3. Future developments – Are there any significant developments about to come on to the market? A release of newly built apartment or unit blocks will place pressure on rental incomes, and can result in a short to medium-term fall in values.
4. Employment – Areas with readily available work are excellent locations. Find out about local employment opportunities in your target areas. If there is a strong hospitality and casual workforce, which is usually evident in tourism centres and university towns, this is great news.
5. Entertainment – Finding a location close to cafes, restaurants and movie theatres is gold if you want an apartment with young professionals as tenants.
6. Neighbourhood – The locality will influence the type of renter. Any location near a university or major hospital will attract students and lecturers, and doctors, nurses, and others employed in hospitals. A rental property near a school is a winner, especially if you’re thinking of investing in a house. Families who rent are usually longer-term tenants.
7. Crime – Seek advice from local police or check the internet for local crime statistics. Vandalism and petty crime can drag down the value of your investment and diminish rental returns.
8. Council rates – Do due diligence on your favoured locations. You might be surprised at the difference in fees from one council area to another.
Investing in property demands a comprehensive understanding of both the local market and broader economic trends. Should you be considering investing in the Snowy Mountains region, we recommend reaching out to our full-service agency, where any of our property professionals in sales, long-term leasing and short-term leasing can offer you advice and guidance that will help you to make informed decisions and navigate the complexities of property investment successfully.
You can reach the knowledgable team at Henley Property by calling our Jindabyne office on 02 6457 2504 or emailing hello@henleyproperty.com.au.
