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Considering property investment? Here’s some tips for choosing a highly ‘rentable’ suburb.

Obviously, when you’re considering property as an investment the key consideration is making sure you get a solid, steady rental yield. Capital growth might be on your mind, but ensuring a regular income so you can pay the mortgage is a priority.

 

Real Estate.com says its own research shows that rental demand is on the increase right across Australia. So what does an astute investor look for? While there are many similarities across the board in what makes a suburb popular with renters, there are some regional differences.

 

Location trumps all

Being close to good cafes, restaurants, retail and transport is a must wherever you’re looking. In Sydney, the beaches remain really popular because they offer a great lifestyle. In Tasmania all areas are popular – and perhaps this is indicative of an overall rental shortage.

In Canberra – suburbs that cater to families are in higher demand, so you’ll be looking for close proximity to schools and family-friendly activities.

 

Do your research to find out what the rental market wants – what is the average age of renters? Are they students? Are they young professionals? Families? The local real estate agents will have this information at their fingertips. Also be sure to do the sums – find out what the rental yields are and what other property expenses there are, such as rates and body corporate fees. Insurances too will have an impact – some suburbs have higher premiums than others, for various reasons. These costs need to be factored in.

 

Don’t buy ‘emotively’

Make sure you check out the competition – if you buy in a suburb that’s saturated with rental properties you could find yourself bargaining down rent prices just to get tenants or – in a worst case scenario – have a vacant property for extended periods of time.

 

Above all, don’t buy emotively in the way you might with a property you want to call home. Buy an investment property with your ‘investor’ head on. This means it’s all about the numbers. Only when you’re satisfied that the property is going to work financially in your favour, should you consider a purchase.

 

Like to discuss further? Give us a call and we’ll come to you at your convenience.

02 9518 5728.

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