“Investing money is the process of committing resources in a strategic way to accomplish a specific objective.” ― Alan Gotthardt,
Buying a property to rent out is a popular form of investment. Houses and units are easier to understand than many other types of investments, yet they do have some issues you need to be aware of.
- Property can be less volatile than shares or other investments
- You can earn rental income and benefit from capital growth (if your property increases in value over time)
- If you take out a loan to purchase an investment property, interest on the loan and most property expenses can be offset against rental income, for tax purposes
- You are investing in something you can see and touch
Where and what you buy will affect your return on investment. The following tips will help you develop your own criteria for a good property investment.
Melbourne Buyer’s Agents Advise On Where & What To Buy
- Areas where high growth or capital gains is expected.
- Target areas where rental income is high compared to the property value
- Research recent sale prices to give you an idea of what you can expect to pay for property in each suburb.
- Find out about the vacancy rates of rental properties in any suburb.
- Research proposed changes in the suburb that may affect future prices eg: planned developments or zoning chang
- Rental properties with features that will appeal to as many people as possible, such as a second bathroom, lock up garage or somewhere close to shops, schools and transport.
Property that will attract more than one segment of the rental market such as singles, couples, young families or retirees.