Residential property can be a great investment selection – but you need to buy well to secure the best return.
Property is widely considered a great investment and a powerful wealth creation strategy. But as with anything in life, there are no guarantees.
Yet if you back yourself with the power of knowledge and employ the right investment strategy, there is no reason why property investment can’t be a powerful wealth creation strategy for you and your family.
If real estate investment is on the horizon for you, try to keep the following tips in mind, and you’ll be well on track to securing yourself a great investment.
Know your limits
Overstretching your budget is a sure-fire way to cripple your chances of doing well in the property market.
Whether you are a seasoned investor or new to the market, there is nothing more important than determining your budget and understanding how much you can afford to borrow.
A mortgage broker can work with you to assess your borrowing capacity and ensure you embark on an investment strategy that fits your budget. With pre-approved finance, you’ll also be ready to strike when the right property comes along.
Location, location, location
When investing in property, the location of your potential purchase should always be front of mind.
Be sure to consider areas that are backed by strong population growth, employment opportunities, development prospects and solid infrastructure projects.
A great idea is to take a drive around any areas you’re interested in and note all local schools, transport hubs, and shopping centers.
A property that is within proximity to such key amenities is usually in higher demand for both tenants and future buyers, which should maximize your prospects of achieving solid capital growth and stable rental income.
Understand the tenant
The location and type of property you purchase will be a strong motivating factor in the type of tenant you are likely to attract.
If you are seeking a long tenancy agreement with a family, it may be wise to consider areas that support such a demographic.
Once again, consider a safe area surrounded by a range of schools and shopping centers to support the needs of your target market.
While there are no guarantees with any investment strategy – understanding these three essential aspects of successful property investment should get you closer to ensuring good returns on your next purchase.