Top Tips When Buying Investment Units
Premier Home Finders follows an important set of criteria when searching for your investment property. Listed below are the guidelines that we follow when searching for your investment unit.
1. Location
- Located within 10 kms of Sydney CBD
- Close to public transportation
- Not on a main road / artery / through-road
- Located in an up-and-coming area that is becoming “hot” – perhaps lots of cafes/restaurants or close to beach
- Good infra-structure around it, i.e. amenities / cafes / universities
- Rental vacancy rate in the area that is less than 2.5% to ensure rental demand for your property
2. Apartment
- Prefer smaller, older style apartment blocks
- Prefer apartments with parking. Exceptions are inner city areas such as Potts Point and Elizabeth Bay where parking is an exception rather than the rule
- Strata title preferred. Unrestricted company title does allow for property rental however banks sometimes won’t lend on this title and if they do lend, it may only be up to 50% of property value.
- Always have a strata search conducted prior to purchase to ensure financial health of the apartment complex and the body corporate.
3. Post purchase
Use a professional property manager to manage your investment. Interview at least two different property management companies who are active in your property’s area – don’t just automatically use the real estate agent that sold you the property. They may be excellent, but you want to ensure that the property management agency you use has a dedicated rental department with a senior staff member overseeing the area. Questions to ask include:
- How much are their fees
- A written comparison of comparable rental properties currently in the market, and
- References from existing landlords using their property management services.
Take out building and contents insurance upon exchange of contracts as regardless if something happens to the property, you are still obligated to complete the transaction.
Disclaimer: This information is general in nature only and should not be relied on as financial or legal advice. Formal advice should be undertaken before acting on any of the information above.