Build or buy? Brick or timber? Old or new? In town or on the outskirts? Finding the right property can be a minefield and getting it wrong will make you wish you had hidden your money under your mattress instead of investing in property.
So how can you be sure to pick the right property for you?
- Know your financial situation. Every property investor should have 2 budgets – a personal budget and a property budget. How much can you realistically put towards an investment property? And I don’t just mean the repayments. You need to consider maintenance, insurance, vacancies, management and letting fees and rates. If your budget is tight, you may be wiser to build or purchase a new home that offers warranties.
- Know your skill level. We have met and worked for many home handymen. Some property owners really do know what they are doing while others do not. If you are not the next Tim the Toolman, don’t choose a property that is going to require a lot of maintenance or you might find that your hand is constantly in your pocket to get things fixed
- Know your audience. If you have strong opinions about the type of tenant you want to attract then you need to know the type of property that will appeal to that tenant. If you prefer not to have little children in your home, don’t go buying a four bedroom home. If you want an executive couple with no pets, don’t cheap out on the fixtures and fittings and room sizes. If you want older tenants, don’t go buying a highset home with 14 stairs front and back.