Property Investing Is All About Location.
Do you only buy in areas with a proven record of growth?
Most novices and first-time property investors want to ‘see the growth before they believe it’. They are happy to buy in areas that have been doing well in the recent past, but much less convinced about areas that have not performed well over the same period. Most areas that have experienced robust growth will eventually come off the boil, and under-performing areas will come good if the drivers for growth materialize.
It’s the supply and demand equation + affordability that dictates growth.
Educated property investors know the big truth about property investing! That is knowing that you make the money when you buy, not when you sell. Your goal should be to get into the right areas before the property cycles reach their peak.
I’ve mentioned in previous articles about buying before the frenzy hits the airwaves. Past historical figures will not give you the details of the rise. Learn from the property cycle and don’t just look to the past.
Watch the video below explaining that property investing is all about locations
Property Investing in locations you are familiar with.
Many people believe they should only be investing in properties in a location that they are familiar with. I’ve heard people say they will only invest near to where they live. That’s crazy, it borders on insane really!!
You don’t need to live near to where you invest. You have to take emotion out of your property investment decisions and base your purchase on demographic research and due diligence.
Simple as that but most people have no idea how to do it.
When you look at the Australian Property Market, you shouldn’t generalize the performance of property across Australia.
There are micro-markets in every macro market!
There are different pockets in different suburbs with different types of properties.
The value of a property in one street can differ significantly from a similar property in the next street, from one suburb to the next.
A prime example is Melbourne, voted the Most Liveable City in the world. Kudos to Melbourne but that does not necessarily mean that it would be a profitable place or time to invest.
The Melbourne market might have moved and going into the market at the wrong time could mean buying the property at a premium price.
Instead of just finding investment potentials in the ten suburbs that you are familiar with, the best investment returns can be in another suburb or another state.
The priority is to find an investment that would generate the best returns that you are hoping to get. So if you can’t find opportunities in your area then look for them elsewhere?
If you are unsure of how to do that, get a professional that will do it for you.
Is cheaper property the less expensive to own?
This is another great property investing myth. Cheap properties are cheap for a reason. They are likely to be:
- In low demand areas
- An older property
- Attract less rent
- Attract undesirable tenants
- Require more maintenance
- Provide little or no tax relief.
If it weren’t any of the above things, it would be more expensive. These items all impact on your capital growth potential.
Remember you always get what you pay for. Look for returns on capital growth not cheaper buys.
The name of the property investing game you play is called LONG TERM CAPITAL GROWTH.
Above all take some form of action today, not tomorrow, TODAY, right NOW.
Ready to take the next step?
Let’s find out what your wealth goals are when you’d like to be living debt-free and how much you’d like to save on your next investment property.