Investing in property is an exciting proposition, but it’s important to do your homework before you start your search. Here are our top tips for ensuring your first property investment is a success.
Consider why you are investing
Firstly, consider your motivation for investing in property. Are you driven by capital growth, or are you motivated by cash flow? Exclusive suburbs may have a large potential for capital growth, but buying into them can be expensive. If your rental returns need to be higher than your outgoings, it may be worth considering more affordable areas.
Use your head not your heart
It is important to remember this property will not be your family home and put your emotions to one side when you begin your search. Take time to find out what you can afford. Talk to your lending institution or a mortgage broker about pre-approval for a loan and research ongoing costs such as insurance, rates, improvements and repairs. Look for lower maintenance properties. Be disciplined and only look at properties that fit your budget.
Think about your ideal tenants
As a landlord, it’s vital to consider properties and suburbs that will appeal to your ideal demographic. Residential, single-family dwellings are popular with for first-time investors as they attract stable, longer-term tenants. Look for growth areas where there is a high demand for rental properties. The ideal property will be close to transport, schools, parks and shops. It’s likely you won’t find everything you are looking for, but make a list of your top criteria.
Consider property management
Many first-time investors make the mistake of thinking they can self-manage their portfolio. Engaging a property manager can, in fact, save you money in the long run, and will certainly save you stress. Experienced property managers will ensure your property is rented consistently and potential tenants will be given a thorough background check. The property management team will also provide a rental appraisal to ensure your property is rented at the correct level, and provide ongoing inspections to ensure it is being looked after. Any ongoing maintenance issues are also handled by the property manager. Noel Jones has an experienced property management team that can free you up to spend more time finding new investments and adding to your successful property portfolio.