What to look for in an investment property – Location
Typically there are two goals in property investment. One is your annual return on your investment, and the other is the capital growth. Now, you can easily make some renovations and refurbishments to boost these; a fresh coat of paint, a new bathroom will boost your rental income. But there is one very important contributing factor that you have only one chance to get right and that is location.
The big challenge to investors when finding the right place to buy is the location. So, investors, here are some tips on where to look for your investment property.
Transport infrastructure – this includes both public transport services and road corridors. Tenants often place a high priority on good access to public transport. By good access, you need to be within a comfortable walk to the bus stop or train station.
For regional areas such as the Scenic Rim where public transport isn’t at the level it is in Brisbane or Logan, access to it is not such a big issue. So instead, you need to look at distance to shops and schools.
We call this Social infrastructure. Before you invest in an area, take a look at the services it offers. What is the shopping like? Is there a good spread of cafes and retail? Proximity to recreational open space will reap benefits too. Tenants with families search for homes near childcare and schools. Older tenants (who are generally brilliant tenants in the way they look after their homes) seek access to medical services.
As you are driving around an area doing your research on location, keep a look out for the general appearance of the area. Does it look like a street, a suburb that you could live in? Are there property renovations going on. This tells you that the locals like it so much they want to stay, so it must be a good suburb. Though you have to be quick on this one as it might mean the bargain buys are harder to find.
Investing in a regional area is a good idea. But, and this is a big but – avoid ‘single industry’ towns. Think mining towns, and some tourist towns. These places can have really strong boom and bust cycles which will impact on both your annual returns (you may have an empty property for months on end) and on your capital growth.
This is why a town like Beaudesert is a very good place to invest. It is the service centre for the Scenic Rim – the whole district relies on Beaudesert. There are multiple industries located here. Everything from primary production, to retail, tourism and manufacturing. It has a variety of schools – public and private; a good hospital, several medical centres and other social services. Beaudesert has a good mix of housing too – old and new; big and small. Though the public transport services could be better, they do exist so that’s a start. The road links between Beaudesert and Brisbane, the Gold Coast and Springfield are very good.
Best of all, Beaudesert has some beautiful surroundings. It’s not called the Scenic Rim for nothing.
When searching to buy an investment property spend the time to learn about the locational factors. Remember, these are the things you can’t change, but will determine how successful your investment will be.
