While Brisbane has not exactly provided extraordinary returns in the recent years, experts laud the capital city for being ‘stable and consistent’ in terms of property values and return on investment. However despite the underperformance of the capital city for years now compared to Sydney and Melbourne, the state of the Brisbane property market could actually be a good area for investors with a long – term strategy. Right now, as the property markets of Sydney and Melbourne continue to follow a downward trend following an unprecedented property boom years ago, Brisbane might just be the safest bet for property investors. With our rental yields greater and the annual cost to hold the property a lot less, it gives investors a degree of comfort while we all patiently wait for the price growth to arrive.
So whether you are looking at your first investment property or your fifteenth, our handy checklist will ensure that your property measures up and fits your criteria and strategy.
DETERMINE YOUR STRATEGY
Before you start on your property investment journey, it is important to understand that you are going to be making one of the biggest financial decisions of your life so it is vital to understand what investment strategy you are wanting to embark on. Is it for capital growth, high rental yields or even both? Is it a new off the plan property which offers you the maximum tax depreciation or are you after an opportunity where you can add value to the asset in the terms of a renovation or a small development. Get it clear, write it down and consult with your chosen team of Property Professionals.
GET THE LOCATION RIGHT
When assessing potential opportunities it is imperative to know and understand the area, demographics and infrastructure spending (economic indicators). You do not want to be investing in areas where job growth is decreasing nor where there is limited government and private infrastructure spending. You want to be looking in areas where there are new schools, shopping centres, cafes and restaurants being built or have even been built and is therefore well established. At the end of the day supply vs demand is a major influencer of property prices, therefore you want your investment to be in demand.
UNDERSTAND YOUR NUMBERS
The greatest investor of our time, namely Warren Buffett stresses the importance to know your numbers before you invest in any asset. Consider all of the costs associated with the purchase of your investment property, including acquisition expenses such as stamp duty, legal fees, loan/interest repayments as well as if you are buying established homes you would want to get a building and pest report. Take into consideration the ongoing expenses such as council rates, body corporate fees (if applicable), property management fees, accountancy costs and insurances. One you have a firm understanding of the numbers you can then make an informed decision as to whether or not that property in question works for your situation or not.
TURN NEGATIVES INTO POSITIVES
Property investments that are negatively geared provide substantial tax benefits. A negatively geared property is when the rent is less than the expenses related to the property. This loss can be offset against your income such as salary and wages. New or near new buildings allow you the maximum depreciation benefits. Professional advice from a quantity surveyor and your accountant is warranted to maximise your depreciation claim.
HAVING YOUR PROFESSIONAL TEAM BEHIND YOU
Property investment does not have to be daunting, scary or off putting. Having the right professionals on your team to help guide and answer any questions you may have along the way is a great asset. The correct team should not push or ‘sell’ you a property but rather assist you in navigating the property investment space as well as create a strategy to help you build a sustainable portfolio.
The team as E-Fishient Property Solutions is dedicated to bringing you a personalised service unlike any other. We offer a full range of property investment services, right from Property Strategy Formulation and selection through to Property Management.
We look forward to the opportunity in speaking with you soon, but until then we wish you all the success in the world.