INVESTING IN PROPERTY WITH INTEREST RATES LOWER THAN THEY HAVE BEEN FOR SOME TIME, IF YOU’RE INTERESTED IN INVESTING IN PROPERTY, NOW COULD BE A GREAT TIME TO TAKE THE PLUNGE SAYS ROD EDMONDS, SUNCORP BANK EXECUTIVE MANAGER BUSINESS BANKING NORTH QUEENSLAND. Purchasing a property for investment purposes can involve a different set of considerations to purchasing a residential home. To improve your chances of profit, property should be considered a long-term investment. With this in mind, it is well worth putting in some extra legwork before you buy, to help make a good investment decision. Here are some tips to consider, before you get started.
WHICH RENTAL MARKET?
DO IT YOURSELF OR USE AN AGENT?
First, decide if your property will cater for the budget, mid-level or executive market. While the “executive” end of the rental market can provide very good returns, this market tends to be more fickle, so you could find yourself without a tenant for a considerable period and no cash flow to meet mortgage repayments. On the other hand, at the budget end you are more likely to encounter higher tenant turnover.
When it comes to property management, you’ll need to consider whether you’ll manage yourself or use a managing agent. Contented tenants will look after your property, so good property management is essential. If you intend to manage the property yourself, you will need to be contactable 24/7 in case of emergencies and have a list of reliable tradespeople you can call for plumbing, electrical or building issues. If you intend to use a property agent, check their background, experience and current management procedures.
LOCATION, LOCATION, LOCATION Once you have determined the type of property, your next consideration should be location. Rental properties that are most attractive to tenants will be close to public transport, parks and amenities such as shopping centres. For long-term capital growth you should also seek out an area with high population growth. Take the time to study which areas are proving popular and where local authorities are developing, or planning to develop, infrastructure.
WHAT TYPE OF TENANT? Consider the type of tenant you intend to target. Are you looking for young couples with no children or will you focus on the family market? Apartments and townhouses are popular with young professionals, while the typical house with two or three bedrooms and a backyard are more suitable for families. In the latter case you should also ensure the property is close to facilities like schools, childcare facilities and sporting fields. To minimise tenancy turnover and appeal to a high calibre tenant, the property should be presented to a high standard. A relatively new or recently refurbished property with good quality fixtures and fittings is important to secure the right tenant who will stay for the longer term.
94 DUO INVESTOR’S GUIDE TO TOWNSVILLE
As Australia’s leading regional bank, Suncorp Bank is in the best position to provide Aussies with a genuine alternative to the major banks, backed by customer satisfaction consistently ahead of the majors. Whether you’re looking to purchase an investment property or a residential property ,when considering home loans, it’s important to consider the full range of options available, taking into account your own individual needs. Suncorp Bank offers a strong suite of personal and business deposit and lending products through a national network of more than 240 branches and business centres and 2200 ATM access points. Suncorp Bank’s experienced team are always ready to help out. To find out more, visit www.suncorpbank.com.au or call 13 11 75, drop into your nearest branch or contact Rod Edmonds directly on 0409 717 008.
Published on May 31, 2013
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