Successful property selection lies in choosing good properties – ones that will rise in value significantly and rent out easily as well. How do you choose a “good” property? The most basic thing to remember is that you are buying an investment property – not a family home. This means you must meet the needs of those likely to rent in that area, features that appeal to tenants may not appeal to you. Aim to buy for the potential tenant not for yourself. These people are your target market, identify the target market meet their needs and you will never be short of tenants.
Consider the following four points when choosing property:-
- Price ~ The best investment properties are not always the most expensive. The best properties tend to be in the lower end of the market it is much more stable and it has the most demand for both buying and renting. There are always buyers and renters in this price range, so find the median price in the area (the price in the middle – half sell above, half sell below) and buy in the lower half.
- Age ~ Whether you buy an old or new property can depend on your needs as an investor both can be good investments. There are a few areas to consider before you decide – depreciation for tax benefits, maintenance is usually less in newer properties, location is vital to ensure escalating rental returns and property values and visually appealing to tenants.
- Position ~ The location of a property is one of the key elements of successful property investing. You want an area that has a good reputation you may choose either end of the market but an area with growth potential, new developments and suitable amenities is important.
- Management ~ Once you have chosen a property you need to decide how you are going to manage the investment. There are two choices: manage the property yourself or employ the services of a professional property manager. There are pros and cons in both choices, if you do it yourself you save the 6% to 10% management fee but you must deal with the tenants yourself and any problems that arise. Professional management cost you a little but they will also take care of any issues that arise. It is often a good idea to have some distance between owners and tenants.
Keep these points in mind when looking for property, continue to learn as much as you can to maximise your investment potential and you are on track for creating wealth.
Power Thought
My future is determined by the choices I make – I choose wisely
Repeat this to yourself several times today
Cheers
Teresa and the Team at
Reference
Jamie McIntyre What I Didn’t Learn in School but Wish I Had, Homestudy Program
Photo
Julie A. Wenskosk’ s portfolio is:
http://www.freedigitalphotos.net/images/view_photog.php?photogid=73
Tags: Buying Property, creating wealth, invest in property, property management
