I notice there are a lot of things people recomend you investigate to get a feel for a area and its potential for investments but i have trouble finding exact info. Can you answer a few questions.
1# What do you look for to find a potential town,suburb or state
2#Once you have a town or suburb how do you research it before you actually go visit.
I hear things like demographic,population changes,average wages,infrastructure etc and i am just wondering how do you search this kind of info.Hi there
I noticed there was a good article in the latest property investor magazine by Margaret Lomas that addressed this sort of queryShe highlighted that she did an initial search on realestate.com based upon how much she wanted to spend, she would then sort the results and ignore any towns that were one industry towns.She then highlighted that she started to do a search of the local council website, any newspaper articles or general information that related to the town she was interested in.She didn't actually go and see the properties but engaged pest and building inspectors, also valuers to report on the particular properties she had pinpointed of interest and ensured her contracts were subject to a satisfactory valuation.The particular magazine also has price details for suburbs in each Australian state at the end of all the articles up to the end of December 2006worth a look perhapsMy ideal property; is a combination of cashflow, cap growth and ability to add value. I look for these factors:
1. must be built after 1987 (for depreciation); you can also buy an older, renovated property which will still have dpereciation benefits, but I prefer newer, un-renoed for better purchase price.
2. purchase at or below market (not super critical to be below market as I buy and hold) and be less than area median and average (cheaper end), for easy resale and bigger tenant pool, and easier to finance.
3. must be in an under-valued or about to grow area for future cap growth.
4. must have high rent demand in area for low vacancy and better rent returns.
5. must be in an area with good employment infrastructure, and the potential for growth.
6. must be close to all amenities such as malls, schools, parks, transport, quiet streets etc.
7. must have add value potential for cap growth and rent increases; subdivision and/or smaller renos.
8. must have rent returns at least the same as existing finance rates.Properties with these factors usually out-perform the market, and are virtually correction proof. They are properties that are very affordable for the majority of people should I ever need to sell, and are very affordable for tenants, which means there is never a shortage of tenants. They are more in demand, so cap growth tends to be steady in all markets.
Research for the area can be done by internet, phoning council or agents, Residex do demographic and other reports for a fee, Australian Property Investor Magazine does market analysis reports each month state by state, study local newspapers for r/e sections to work out local values etc, and there is lots of info on the Aus Bureau of Stats site as well. Also use these forums as the word spreads around about what is going on in the market.
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