When it comes to property investing, there are certain factors that smart investors are always looking out for.
We’re going to show you the eight main things to keep an eye out for when considering investing:
1. Capital Growth
Capital growth refers to how a property increases in value over time. It’s one of the key ways that investors build wealth. Investing in a location that gives you sustainable levels of ongoing capital growth is a crucial element of property investment.
2. Rental Yield
Smart investors look for cash flow positive properties with high rental yields. A high rental yield means the rental income is greater than the costs of owning and keeping a property. A high rental yield will typically give you a passive income, and more cash in your pocket.
3. Government Spending
When the government is investing in infrastructure in a particular area, it creates a higher demand for people wanting to live there.
A rising population means that more people will need homes to live in and will therefore contribute to capital growth. Age, immigration, and socio-economic status can all impact an investment. Tracking demographic changes and trends can help investors make better decisions.
5. Vacancy Rate
A low vacancy rate is a good indicator that a region is worth investing in. A market with a low vacancy rate has a significant demand for rental properties, where rents are more likely to be increased and landlords can have their pick of tenants, making it a landlord’s market.
6. Supply & Demand
It’s important to know the supply of investment properties in any suburb you are considering. Investors have to avoid areas that are oversupplied with investors and focus on regions with a strong presence of owner-occupied properties.
If you own a rental property, it is important to maximize your return on investment by claiming all your eligible tax deductions. Investing in newer properties will give investors higher tax breaks.
Getting access to opportunities under market value will ensure you are generating instant equity from day one.
With these tips in mind – where are you looking to buy? Get in touch to discuss how we can help you get your foot in the door of property investing.