When you are considering making a property rental investment you really need to know all of the details surrounding it. It is wise to rely on experts to assist you with this investment. Many wise investors will suggest buying blue-chip median priced properties. These should be located in the inner urban locations. There are many advantages to doing this.
The reason it is suggested to buy blue Chip properties that are in the inner surface suburb is because there is a good market for the working professionals who find living in this area to be most feasible for them. They want to live in an area where there is good access to good calibre shopping and other amenities such as restaurants. They want to be able to enjoy the outdoors via parks and beaches.
There is always going to be a fair demand for rental in this area because there is a limited supply to meet the demand. It is generally accepted that white-collar workers are considered to be good as tenants because of their reliability.
What you want to look at is the figures that are going to bring stationary or consistent yields. These are usually those within the median price range of 10 to 20% which is estimated to be about 80% affordable for most renters. Something else to keep in mind is that in the event that you want to sell this type of property you are going to have a good chance of doing so because it is always in demand. It may seem lucrative to buy higher priced properties thinking about the potential return that you may be able to glean from these, but these might not be the best choice. Because of having to rent them at a higher price it can mean that vacancy rates are higher. Whereas this is not as likely when you are looking at the properties that are median priced.
You need to do a little bit of research to get the returns that you expect from your rental property. There are many resources that you can use to help you with this research.
It is indicated that any areas that are between 5 and 15 km from the CBD’s are in demand because of the limited supply. It has been shown that these areas are better performers.
You want to be sure that you can meet the needs and wants of your target market. This includes the amenities such as the outdoor space for beaches and parks, and cafés perhaps.
Learn to analyse your target market for what type of property they are looking for in regards to a house or unit, and the number of bedrooms they want at the price that most will buy it.
It is highly important that you research and learn the potential area well that you are thinking of investing in.