Where to Buy Property????
Of all the people buying property in Australia at the moment, one in four buyers are looking for investment properties.* Each and every one of them will ask the same priority question – where to buy?????
Here are the steps to follow when choosing a location to buy property:
Learn all you can about the area your looking at. Getting a good sense for what is going on in the area is vital. Get into conversations within the community. Chatting to people like the local corner store, newsagency, local coffee shops will give you loads of ‘insider’ information that can be invaluable. Stop by and spend time with local real estate agents, look through some other home opens and really immerse yourself in understanding all you can about the area.
Use the internet to add to your collection of knowledge of the area.
Sites like house.ksou.cn and onthehouse.com.au can help you to find the price of properties after they have been sold which is often useful.
Look for the ‘ripple’ effect. A ‘ripple’ is the area that is next affected by something else. For example, if you take a beach area that is too expensive to buy into, the ripple effect will be the next suburb out.
Inner city buying has always held good returns for investors and quickly becomes unaffordable. On a map, draw a circle that indicates a 5km radius from the city centre, then focus your attention to the next ‘ripple’. That is, the next 10km out. This will still be a good location to identify potentially great deals.
If dwellers can’t have the ‘cherry on top’, then they will always want the next best thing. And that next best thing is often found in the ‘ripple’ area.
Look for well established suburbs. These areas have been lived in for a long time and new pieces of land are extremely hard to find, if not impossible. Land sizes are often bigger and have more potential for development. Facilities and infrastructure are all in place and these suburbs are generally highly sought after as places live. This demand will continue to force pricing upwards.
You’ve got to buy a property that is close to facilities and infrastructure. When we bought our unit in Churchlands, Perth these were some of the benefits:
- 200m from a popular small supermarket, newsagency, postoffice, chemist and takeaway food facility.
- 2 main shopping centres – 1 is 2km distance and 1 is 8km distance
- Bus route right outside the front door to universities, beaches and city
- Coffee shops across the road
- 6 mins drive to the City Centre
- Primary and Highschool within 5 mins drive
- Two quality beaches within 6 mins drive
- Local parkland and walking trails 100m away.
These are the exact facilities and infrastructure that buyers and tenants will be looking for. You want to be able to mark off all of these items against any property you are looking to buy.
Consider suburbs that are in your price range. Using the ‘ripple’ effect, you may need to go just outside of a hot spot in order to find properties within your budget. Research street by street because while most of a suburb may be out of your reach, there can always be hidden gems to be found if you look closely enough.
Look at suburbs that are going through a rebirth. Strongly consider areas that have older buildings that you notice are starting to be replaced with newer ones, or redevelopment. Use data from sources such as RPData, Suburb Reports: Movers and Faders and the local Council to gain an idea of the demographics of an area and see if you can buy a property that is suitable to renovate to the newer demographics of an area.
Councils don’t plan on spending money for roads, rail, sporting complexes or other upgrades if they don’t see the demand for it. Make the local Town Planner your best friend! The local planner will share with you what new infrastructure is planned and this will give you an idea of how quickly the capital growth of an area will happen.
Look for where big companies are spending their money. Companies like Dome, supermarket chains, Bunnings, McDonalds and others will only set up shop in areas of high growth.
First the suburb – then the street!
Once you’ve nailed your ideal suburb, then drill down to find great streets. Every suburb will have it’s high and low end areas. Go through the same type of considerations mentioned above to help you decide on an ideal street such as your price range and meeting market demand in relation to the demographics.
Talk, look and most of all listen to what locals have to tell you.
Having struck up a good relationship with local real estate agents, you will often find they will alert you to a good deal even before it gets to the market. Either way, once you reach this stage you’re ready to take the next leap and buy a property.
If you’re still wondering if investing in property is even a good idea at all, you may want to go back and read this article: http://propertyinvestingsupport.com/why-invest-in-property/
* Australia’s largest mortgage broker, AFG
Here’s to your success!
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