Firstly, there will always be demand for rental property. The proportion of the population that are renting is steadily increasing. One of the main reasons for this is that Australia has a strong economy with good infrastructure and this attracts migrants and students from all over the world. This increases the population and demand for housing across Australia.
Also property prices are increasing at a rate which is making it unaffordable for many Australians to ever buy property and they are destined to be renters for their whole lives.
In this blog we’ll examine some of the factors you need to consider when buying an investment property.
Every type of property has its own pros and cons but demographics is critical across the board.
For example if you are considering investing in an area with a large student population you should look for properties which need less maintenance (such as apartments) and which are close to educational institutions.
If you are considering an area that has young families, look for houses with a good backyard and which is within walking distance of schools and amenities like day care centres.
All properties require maintenance. To prevent high maintenance costs it is best to purchase a property that has low maintenance needs.
Typically, brand new houses and apartments are those requiring lower maintenance. Especially in the first 10 years or so as it is less likely that these properties will have structural issues or items that require replacement. Older properties are more likely to have structural issues (e.g. asbestos) that could leave you with a hefty repair bill.
Purchasing a property with lower maintenance needs will undoubtedly get you better returns on your investment.
It is critical that your property is properly managed. It’s important that tenants pay their rent on time and that any required repairs are attended to as soon as possible.
Your property manager will carry out routine inspections and identify any issues before they become problematic which can cost you even more to fix.