Finding the Right Investment Property for You
Consider where you are now and where you want to be in the future and carefully model the appropriate revenue generation. This is where we excel in planning and strategically generating long-term income-generating properties.
Firstly, what’s your property investment strategy
Most people know that they want to invest in property; it's familiar to most, and it's a widely proven method of success… If you get it right…..
Most people aren't unaware of the importance of planning for that success by creating a long-term strategy based on your current situation, timeline, age, income and net wealth goals.
This is just the start.
Because the property market involves cyclic markets, multiple parties involved in buying/selling with multiple drivers and outcomes, data (lots of data), city/future planning and various other moving parts, having a professional in your corner who is involved in each of these stages, advising and managing each of these stages on your behalf places you in the strongest possible position to reach your property net wealth position.
This is where we come in.
Talk to a Ramsey Property Wealth Strategist today who is backed by a winder team of Property Analysts, Acquisitions Specialists and Lending Advisors who put the whole piece together.
For now, here are our top tips….
How to choose a suitable suburb for investing
Determining the location of your investment property can be challenging, and the right approach can depend on your investing goals and budget.
Looking for an area that appeals to a wide range of prospective tenants is a good idea. Suburbs with high demand are less likely to have high vacancies, meaning your property is more likely to be occupied.
Research suburb property values
To better understand if you will make a return when you sell, you'll need to estimate capital growth and rental income.
You can leverage data such as a suburb's current and historical property prices. Recently sold properties can help determine potential
capital growth, while median rental prices can help you estimate the income your property could generate.
Research rental vacancy rates
Locations with high vacancy rates may indicate a weaker rental market, while low vacancy rates generally point to a more robust rental
market. A rental vacancy rate is the % of available rental properties that are vacant or unoccupied.
Understand local services and amenities
Properties close to employment opportunities, reliable public transport, schools, shopping centres, and parks perform well.
Buying an investment property in a desirable location can improve the chances of making a capital gain when it comes time to sell.
Consider future development plans
Before you choose a location for your investment property, it's worth enquiring with the local council about any upcoming developments nearby to understand how these plans may affect the area and your property.
What features are essential when purchasing an investment property?
When inspecting an investment property to buy, put yourself in the prospective tenant's shoes.
Consider features like a garage, additional bathrooms or a study that could increase the property's rental and capital value.
Other things to keep in mind include the layout and design of the property.
Does it have an extra living space?
Does it get natural light?
These are features tenants likely look for, so you should too.
If you are considering future property development, then the size of the property and its potential for subdivision or renovation is
equally essential. Investors looking for short-term rentals should consider if the property suits guests or short-term tenants visiting
How to manage an investment property
Far more than finding tenants and receiving rent, as a landlord, you're responsible for ensuring your investment property remains profitable
while providing a desirable rental property.
Should you get a property manager?
A property manager makes owning and managing a tenancy significantly easier for many investors. They can handle the administration, typically charging a percentage of the weekly rent or a flat fee.
Here is how property managers help you:
Marketing the rental property
Most likely, this involves listing the property on a real estate website and arranging in-person and virtual inspections.
Source, interview and secure tenants
A property manager will support you with virtual or in-person inspections and allow interested parties to view the property.
Property managers will then assess each applicant for suitability. Often, real estate agencies and property management groups have access to
a tenancy database, allowing them to review the history of prospective tenants.
Manage repairs and maintenance
A property manager will coordinate on your behalf, from emergency repairs to plumbing or electricity to regular maintenance such as paint
Provide rental market guidance
To help you stay on top of rental market trends, including tenant and landlord regulation changes, a property manager can help you stay up-to-date. For example, the property manager will guide you in ensuring the rent is priced for the current market.
How do I rent out my property?
Whether renting out your property with a property manager or on your own, knowing how to lease your property successfully is essential.
Determine the rental price
You'll need to set a price when advertising a property for rent based on the following factors: location, property size and type, condition and convenience to nearby amenities.
Prepare the property for lease
Before listing your property, it's essential to ensure it is suitable and safe for living. You should consider professional cleaning and outstanding repairs and ensure the property complies with relevant rental regulations.
Listing the property
If you're using a property manager, they'll arrange to list and market the tenancy on your behalf. Typically, they will list the property on websites such as www.realestate.com.au and www.domain.com.au, as well as through their database of tenants.
Your property manager will arrange property inspections privately or as an open home inspection. Usually, this process allows the property manager to understand tenant suitability.
Selecting a tenant
Prospective tenants will then apply, and by using a property manager, you save time as they will review their applications. Generally, when assessing suitability, you or the property manager look at current employment status and income, rental history and references from their workplace or previous landlords.
Leasing the property
Once you find a suitable tenant, you or the property manager need to offer a tenancy agreement to be signed.
The usual terms in the agreement include rental price; lease term; bond amount; deposit amount; the number of occupants, and any other special conditions (such as pets).
After both parties sign the agreement, the tenant usually pays the rental bond and deposit and completes the property condition report.
What type of insurance do you need?
Landlord insurance will cover the replacement or repair cost when damage occurs to a rental property. Typically landlord insurance covers the cost of loss, damage or repair caused by either theft, fire, storm, earthquake or malicious acts.
Purchasing landlord insurance when investing in property is recommended to minimise your risk of financial loss in a natural disaster or another insured event. Many lenders may require you to purchase insurance when renting the property.
Support with property investing
When you decide to invest in a property, it is a considerable process, compounded by trying to achieve a work-life balance. You need to set up a plan with outcomes and models that will make your investment(s) successful; understand your borrowing power; the property type and location; and all the while, appoint buyers agents and property managers to help you.
Having an advisory firm in your corner, dedicated to your entire property investment journey from the start to when you cash out, is crucial to your end success.
Nobody does what we do quite like how we do it.
If you’re serious about generating long-term wealth, value strategic advice, structure and the execution on how to get you there - contact
our expert property advice, acquisition and mortgage strategy team today on 1300 001 215.