3 things to consider when investing in property
Investing in property can be a wise choice due to its potential for strong capital growth and reliable passive income. However, it is essential to understand that property investment is a strategic decision that requires a clear understanding of your goals and objectives. Here are 3 things to consider when investing in property.
Clearly define your reasons for investing
Unlike buying a home, investing in property is not an emotional decision, so it’s essential to know your “why” before investing. Before investing, you should be clear about the duration of the investment, whether you’re looking for a short-term rental return or a long-term investment for retirement. These factors may impact your choice of property and location. Hence, it is important to research the suburbs and properties that match your investment goals.
Check out the beginners guide to investing.
Get clear on your budget
To invest in property, you need to have a clear understanding of your financial situation. Lenders evaluate your financial history and expenses, including rates, levies, capital works, and maintenance, to determine how much you can borrow. They also consider the potential income from the property and current and forecast capital growth in the area. This information helps them determine whether the rent will cover expenses or if you’ll need to cover the mortgage repayments and other expenses with a portion of your income.
Consider the location
Once you have your finance sorted, it’s time to look at the type of property and location. The type of property you choose to invest in will have a significant impact on your obligations for maintenance and upkeep. For instance, an apartment investment will require you to consider strata levies, which can significantly increase your costs each quarter. Additionally, you’ll need to consider the location of the property as this will impact the capital growth and rental yields.
All properties require maintenance and upkeep, and investing in property is no exception. Depending on the age of the property, you may need to allocate funds to cover regular maintenance, repairs, and future refurbishments such as paint, carpet, blinds, kitchens, and bathrooms. To ensure the smooth running of your investment property, consider engaging an experienced property manager who can provide expert advice to maximise your investment and take care of the day-to-day operations. After all, investing in property can definitely be a reliable and profitable asset with the potential for strong capital growth and passive income.
If you own an investment property, the day-to-day management can be quite challenging. However, an experienced Property Manager can alleviate the stress by providing expert advice and support to optimise your investment. Our property management team at Soul Property Agents can help you find tailored solutions to make the process of owning an investment property seamless. Don’t hesitate to reach out to our team to learn more about how we can assist you. These 3 things to consider when investing in property will start you on the journey!