5 Ways to Determine the Best Investment Property Location

If you’re considering buying an investment property, you’re probably already aware it’s a big commitment. Not only do you have to come up with a deposit, but you also have to be prepared to handle repairs, vacancies, and other expenses that can come with owning a rental property.

Before taking the plunge, it’s important to do your research and ensure you’re prepared for the financial and emotional challenges of being a landlord.

What is an Investment Property?

An investment property is a piece of real estate that is bought or developed to earn a return on investment, either through rental income, the future resale of the property, or both.

There are different types of investment properties, from residential properties such as apartments and houses to commercial properties such as office buildings and industrial warehouses.

One of the most important factors when buying an investment property is its location. Properties in prime locations are more likely to appreciate over time, making them a good investment.

Another important factor to consider is the type of property you are buying. Residential properties can be a good investment, but they are more likely to be affected by economic changes, such as interest rate rises. On the other hand, commercial properties are typically less affected by economic changes and can provide a steadier return on investment.

When buying an investment property, it is important to research and seek professional advice to ensure you are making a sound decision for your overall investment portfolio.

Websites such as Domain and realestate.com.au also have tools to help you do your own research online.

How to Choose the Best Investment Property Location

There are several factors to consider when determining the best investment property location for your property and your portfolio. Here are five key considerations that will typically increase demand for rental properties, leading to higher rental prices and capital growth:

1. Population Growth

Seek out areas with strong population growth. Strong population growth drives increased demand for housing, and therefore a strong property market.

2. Infrastructure

Areas with good infrastructure (such as public transport, schools, and hospitals) are often attractive to new tenants and can also drive population growth (see above). Also, look at plans for further infrastructure development.

3. Economic Activity

Areas with strong economic activity are often more desirable places to live.

4. Affordability

Consider affordability – locations, where the property is more affordable, are often more attractive to tenants, as they can get more for their money.

5. Lifestyle

The final factor to consider is lifestyle. Areas that offer a good lifestyle (such as access to amenities, good weather, and a low crime rate) are often more enticing places to live.

Location, Location, Location

Location is one of the key factors if you’re looking to make a real estate investment. There are many elements to consider overall when determining the best location for your investment property, including the local economy, the housing market, the crime rate, and the quality of schools and other amenities. As always, do your research and due diligence before making any major investment decisions.

Newcastle Financial Planning Group can help you with your investment planning and make sure that you’re making educated and strategic decisions for your portfolio. If you are an experienced investor looking for a fresh approach to your portfolio, or just starting out with investing and need expert guidance, call us or book online to secure your first appointment with us today and learn how we can work together to achieve your financial freedom!

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