If you’ve been thinking about buying your first home or investing in a rental property, now is the time to take the plunge. The Australian interest rate dropped to a record low of 2.5% in August in 2013, which is very good news for prospective homebuyers. The Reserve Bank has kept official interest rates on hold since then, but with early signs the economy will pick up next year, now could be the time to lock-in a great fixed loan rate.
While the timing is right to invest in real estate, it’s important to do your homework to secure the best investment property to suit your lifestyle. These are our 3 top tips to help first-time investors benefit from an opportunity of a lifetime
1. Know your options
Not all investment properties are the same, so it’s important to work out what type of property will fit your investment strategy. Consider whether you are interested in residential housing, apartment buildings or commercial real estate like an office or warehouse. Would you prefer to buy an existing property or a house and land package?
House and land packages are a popular option for property investors, because the home’s value could increase significantly by the time the building is complete in a rising market. There are also substantial tax deductions for purchasing new homes.
2. Find a high growth location
Location, location, location – We’re sure you’ve heard this catch cry before! Whether you are buying for yourself or purchasing a rental property, location is the key to a lucrative property investment and there are several ways to identify an area with the potential for growth.
Investigate the demographics, patterns of previous capital growth, vacancy rate and amount of established land already available on the market. “If you’re looking for a rental property, homes in high-rent or highly populated areas are ideal”, suggests Mark Borg, Director of Residential Projects Australia. “Homes within a good distance to public transport, shopping centres, schools and local amenities are always attractive to tenants.”
For more details on finding the right location for your investment property, check out the RPA property pre-selection criteria.
3. Consult a professional
The best way to learn real estate investment fast is to consult a professional with experience who already owns investment real estate. The property investment consultants at RPA have established property portfolios. They have their finger on the pulse of the real estate market, and they leverage their connections with the right people to make quick, smart moves. With affiliations with real estate agents, financial planners and advisors, the RPA team will help you identify your ideal borrowing capacity, secure a loan and find the best starter property to suit your circumstances.
As with anything beyond your knowledge and expertise, if you make a decision without doing your homework, you may set yourself up for some quick and painful lessons. Contact RPA today for a free consultation, and we’ll get you on the right track to reap the benefits of your first investment property. You’ll be building your property portfolio before you know it!