Investment property owners often have very different goals or strategies in mind than those looking to buy a property to live in, with the conventional wisdom being that investors should think using their numbers as opposed to their heart.
Understandably, a lot of investors look for the cheapest property that can return them the highest yields, however a property’s long-term prospects for growth should never be discounted.
There are a number of different investment strategies out there and everyone has different goals, however capital growth should arguably be the main focus for residential property investors. If you want the most capital growth then you should look at properties where people want to live.
Go where the owner-occupiers go
The most in-demand properties are always going to be the ones that both owner-occupiers and investors want. When a property has a broad appeal then it will have a bigger pool of buyers and it’s more likely to see higher growth over time too.
This means that you should look at areas that have things that local owner-occupiers would look for. Think about where you would want to live in a particular suburb? Would you want to be near the best schools in the area? Or would you want to be able to walk to the shops or nearby transport?
Every area has its more desirable pockets, so it’s worth finding out where they are and considering your investment options there.
What is the local tenant market like?
It’s also worth factoring in what the local tenant market will be like. Generally, tenants are looking for similar things to owner-occupiers. They want to be in the best part of town and they probably also want a place that is clean, modern, private and low-maintenance.
Just as the area is important, so is the quality of the property. The better quality the property is the more likely that you will be able to attract good tenants.
Don’t underestimate the importance of attracting good tenants; they are crucial to the long-term success of any investment property.
Whether you plan to buy a property to live in or invest, it’s always worth looking at something that ticks as many boxes as possible. Try to find a good balance between cash flow and prospects for growth.
Don’t just go for the first place you see because you can afford it. Think about it’s long-term potential and how much it will cost you to maintain and look after the property over time.
For advice about property investment in the Bacchus Marsh area, contact the team at Arbee Real Estate.