While property has been an incredible investment for millions of Australians over a long period of time, you still want to make sure you’re buying the very best property you can.
Putting a little bit more time into the search for a quality asset could make a huge difference.
Here are three mistakes to avoid:
A lot of new investors want to get into the property market but don’t spend enough time doing the due diligence that they should. Purchasing a property is a big decision and it’s important to determine the best location to buy that will give you the best return over time.
When looking at locations, observe the history of price growth in the suburb as well as the demographics that are living there. Also look at the infrastructure and amenities currently in place, and if anything else is planned to be coming soon.
Finally, examine how much stock is currently on the market compared to how much is selling. The tighter the market, the better your prospects for future capital growth.
Not thinking about tenants and buyers
When searching for a property, it can be easy to start looking for a home you want to live in. The only problem is, what you might want may not fit what the majority of people in the area want.
A great example might be buying a unit in an area that is dominated by families who want large homes. While the suburb might tick all the boxes, if you’re not buying the right type of home, bother renters and future buyers won’t be as interested in your property.
Not looking at the costs
When you purchase a property, there are several costs to factor in such as stamp duty and closing costs. However, the costs don’t stop there.
When you own a property, you will also have to factor in the ongoing costs such as strata fees, council rates, water rates and things like maintenance.
When doing a budget, it’s easy to forget about the costs that come with holding a property. While your rental yield might look good at first glance, the more your budget factors in the long-term costs, the better it’s going to be.