5 Tips To Find The Best Properties To Invest In, Even In A Downturn
Property is an amazing asset that can grow your wealth over the long term. However, it’s vital that you invest in the right properties, because making a mistake can cost you big time.
It’s like when you play Monopoly.
Let’s be honest… No one ever really wins Monopoly with Old Kent Road.
Those brown-coloured cards provide you with only a small amount of rent and even when developed, return almost the lowest ‘income’ on the board. In my opinion, they may as well be ‘Free Parking’.
When I play Monopoly (yes… I do) I like to buy up the yellow, green and dark blue suburbs.
It’s really quite simple. They command a higher rent which goes up proportionally to each new home you place on them. While they cost more initially to invest in, these are the places you need to own to win.
This analogy runs true with property investing. To win, you must invest in quality.
So here are 7 tips to help you find the best property investment.
1. Look for areas with high growth
Capital growth will be the number one reason you succeed or don’t in property investment. Look for areas where the population and the economy is growing. This is why hubs such as the CBD have grown so much over the years.
2. Rental yield is important
There are some ‘experts’ out there who think you shouldn’t look at rental yield. However this just simply isn’t right. You need a property that won’t be hugely expensive to hold. If your property is close to providing you with net positive cashflow, then holding on to the property even during a downturn will be easier. At the end of the day, the aim of property investment is to fund your life, so you can work less. Finding a property with a good rental yield will help do this.
3. Look at vacancy rates
A market with low vacancy rates indicates that the area is hotly contested. There’s plenty of research sites you can look at the vacancy rates for a suburb. You can also ask different real estate agents when doing your research. Find a property that you can be confident will be rented out 99% of the time.
4. Research infrastructure projects
Research the different infrastructure projects planned for the future. You can do this by going on a local government website. A large construction such as a hospital or shopping centre means there will be a big employment boost in the area. This results in more renters and higher demand.
5. Know what tenants want
Tenants want different things depending on the area. In some areas, a 1 bedroom apartment is perfectly fine. However, there are some areas that properties with a backyard would be more suitable. The key here is speaking with Real Estate Agents and experts and researching the market.
Finding and choosing the right investment property takes work. You will need to do the research or outsource this task.
If I can give you one tip, it would be to just speak to experienced and successful investors and mentors.
By finding the best investment property you will be on your way to success.
You can speak to a coach or mentor at one of our free property investment webinars coming up. Click here to book
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