TOP 10 TIPS TO PROPERTY INVESTMENT
make your investment a success
1. Remember, this is an investment, not your home. Do not fall in to the trap of making emotive decisions or using the same criteria as you would when looking to purchase your own home. Choosing an investment property should be based purely on numbers – and most importantly what the yield is.
2. Do not overcapitalise on your rental property. Before undertaking any work you must consider if the improvements you are planning on will be returned to you in rental income.
3. Generally yields tend to be better in less expensive suburbs. Where you aspire to live may not be the best choice for your investment. However, you also need to consider how much the property will appreciate in value.
4. As with all property transactions, try to buy below market value. Select a number of suburbs you think are likely to increase in value over time and look for opportunities such as distressed sales, deceased estates and mortgagee sales.
5. Think about resale. Will the property be attractive to other buyers when the time comes to sell? Is there something special about the property that will attract interest such as its aspect, local schools or privacy.
6. Make sure you have thought about the "what ifs”. What if you have periods of vacancy? What if interest rates increase? What if you need to sell quickly?
7. When you have made the decision to buy, consult the professionals. Use a mortgage broker to find the best lending rate and get legal advice.
8. Find a good property manager and let them do their job. They will find the right tenant and make sure the rent is paid on time.
9. Insurance is important. Your property manager can advise you on what you need.
10. Finally be a good landlord. Be proud of your investment and look after your tenants.