Tips to consider before buying an investment property
It is super important to have a clear understanding of your finances. The first and crucial step is to get a pre-approved loan from your financial institution, this will allow you to know exactly how much you have to invest.
Buy a property in demand
Pursue properties that are in demand. Properties in growth areas are ideal for investments as these areas will continue to grow, your investment value will most likely increase as well. Some signals of investment growth areas are:
Closeness to the city
Transport is easily accessible
Close to schools and amenities
Attractiveness to your audience
By identifying the ideal tenant for you will help you better buy certain properties, you want people to want to live in your investment. You would need to consider the number of bedrooms, bathrooms, does the property have a car park, and most importantly if the market price is fair for the building/property and the area. Attractiveness to the market’s needs will enhance your investment.
Realistic Investment Goals
Investing in property is a patience game plan and you will need to be prepared to be patient. By researching the current market will assist you to estimate your returns from your investment.
It is very important that before you purchase your investment property, you know every aspect of your building. The last thing you want is unwanted surprises for you or your future tenants. By organizing building inspections before a purchase will save you a lot of pain and money in the future. Crucial checks include but are not limited to:
There is no faulty wiring or a lack of smoke alarms installed at the property
Sundry structures such as patios, sheds, etc; to ensure they comply with regulations
Hazardous materials such as asbestos or flammable materials
The building is structurally sound
Don’t get too invested
Traditionally buying a property is an emotional and personal experience. However, when buying a property as an investment requires you to make decisions with your head and not with your heart, this is vital as you want to maximize your profits and investment goals.
Maintain your investment
When committing to buy an investment property, it is best to keep up with maintaining your property. Why? It will keep your future tenants happy and it betters the chances of a higher rental return and a possible sale in the future. The more you let the property go, the more issues will arise. It is important to keep on top of your maintenance as issues arise.