Sometimes the most important information is right there in front of us, hidden in plain sight.
So, too, are today’s property investment blinds spots that I want to share with you.
As a conveyancer, I am trained to go through long, contractual documents thoroughly, to make sure you don’t agree to anything you shouldn’t and understand everything involved in a property transfer.
However, today’s insights involve blind spots that can affect us all when we get serious about property investing.
You are not buying for you
One of the most important things to remember, and easiest to forget, is that you will not be living in your new property.
There must be some in built instincts about providing shelter within us all because when we start looking at real estate we find it difficult to divorce our personal preferences from the preferences of people most likely to rent our property.
You really must be disciplined in thinking about the popular and important services and attractions that future tenants will seek.
This can mean cafes, restaurants and bars, cinemas, schools, shops, etc.
If your lifestyle is different from the lifestyle of the people you want to attract to your property, it is time for more research.
Public transport is great, at a distance
It is one thing to find an investment property well serviced by public transport.
It is an entirely different thing to find a property that sits directly next to a railway line or has a bus stop at its front door.
The noise of trains and the constant milling of people at a bus stop are not typically thought of as desirable things.
Wise property investors understand that buying somewhere within a five to 10 minute walk from public transport achieves the sweet spot.
Such properties are quieter and more private while also having the convenience of being ‘well serviced’ by public transport.
Remember the laws of supply and demand
Recently, I wrote about a number of new properties coming online in Adelaide that have large stamp duty discounts available if you buy off the plan.
An experienced accountant or financial advisor, coupled with your conveyancer of course, will be able to help you navigate the pros and cons of the situation.
The reason I mention cons is that it is often thought that buying off the plan means a large number of apartments will go on the market at the same time, putting downward pressure on rental rates.
When it comes to attracting tennants or ultimately selling your property, you want it to be unique and stand out in the market. Keeping this in mind might help you decide between various candidate properties you are considering.
It might also prove wise to make use of the South Australian Government’s Housing Construction Grant, if you are prepared to enter into a contract to build your own investment property before the end of 2013.
There are a number of conditions to the grant but it is worth investigating as one of your options.
Find out more at the Revenue SA website.