If you would like to earn money like a realtor, you want to understand what to invest in and where to find it. Luckily, we have compiled this specialist list of property investment advice tips that will assist you to concentrate on purchasing the best apartment for you!
1. Selecting the right kind of apartment
Do a bit of research and discover what neighbourhood or area tenants desire. Are two bedrooms/two toilet units exceptionally sought after in the region, or can off-street parking much more precious than another toilet? Ensuring you will have demand for your investment apartment is important. Also, consider the age and structure of the apartment, whether it is an affordable refurbished older building or perhaps luxury inner-city apartments for contemporary couples. This will help you develop your target audience and subsequently marketing strategy for leasing. A tenant is your income so ensuring your property meets the needs of tenants searching in that area is a must.
2. Get the location right
Apartments located in safe suburbs not too far from the city are highly valuable. Location in close proximity to schools, public transport, beaches, parks and leisure facilities are also bonuses. You may see a great apartment for a great price but if it is not in a desirable location then it could be worthless when you cannot find tenants. Again, look at your target audience, families will need schools and parks whilst couples may desire public transport and convenience. Investing in the outer suburbs may not be as popular due to travel distances however affordable living tenants may present.
3. Consider looking for more compact blocks
A smaller scale complex with a high proportion of owner-occupiers is an excellent property investment strategy as owners will normally take care of the daily running of their apartment more attentively than tenants will. This means the property will be actively looked after and you will be part of a stronger committee.
4. Create immediate equity
Fast, low-cost renovations may have a massive influence on your apartments’ value. Ensure that you will double the value of money spent renovating to increase capital. Renovating is a great way to get that instant boost and maximise value. Making the apartment look attractive and ready to move in will surely help you gain tenants quickly. Tenants want that immediate homely feeling and minimal work. Make the property look like a place which you would like to live, the more appealing the more tenants are willing to pay and the better rental income you will achieve. Use an equity calculator to decide whether a renovation is worth carrying out and estimate the costs and returns.
5. Get an independent evaluation before you purchase
Buyers can become emotionally involved when purchasing property and risk paying for the house is worth. Buyers become delusional when faced with decisions and sometimes settle for a price that does not reflect the value of the apartment. During an independent evaluation, you can practically guarantee you won't ever overpay. Buyers fall in love with the contemporary apartment living style and splash their money without doing further research, this is dangerous and they could have gotten a better price with some research and an evaluation.
6. Check the age and condition of facilities in the building
Affordable apartments are also highly demanded but this doesn’t mean you can compromise conditions and safety for some easy money. Apartments that are falling apart may costs you more in repair costs than the rental income you receive. Also, ask about the age of the building and the last time it has been renovated and replaced. Are kitchen appliances and water and gas systems working well? Do doors have adequate locks and are heaters working? You may run into a lot of additional costs than you think when investing in an aged apartment.
7. Think about the long-term returns and risks
Property is obviously a long-term investment and commitment. Be patient about your returns, don’t expect prices to increase immediately, you will need to keep up with maintenance and monitoring of your apartment. Having a long-term approach is the key, you can trust a property management agency to look after the property for you and always ask for advice if you are not about any local regulations or tenant rights. Remaining compliant with legal restriction is a must, if you have any disputes or problems with tenants then it is important to resolve them peacefully. Other risks in the long term include vacancy due to economic conditions or other factors and financial instability due to fluctuations in interest rates as well as simply choosing the wrong tenant.