Buying an investment property, apart from your own home, is often one of the biggest purchases we can make. However, it’s not all return on investment right away and for forever…especially if mistakes are made.
Many first time, or even seasoned landlords can feel overwhelmed in the process – but it really doesn’t have to be this way. Having a professional Perth property management team by your side is one of the greatest assets you can have for your investment property.
Want to know the investment property mistakes to avoid?
Read more from the Perth property management professionals at Pro Property Group to find out.
You’re looking at the short term, instead of long term
There are two key questions to ask and answer when it comes to buying an investment property:
- Will this property deliver sound capital growth?
- Will it yield a good rental return?
While it’s the potential for attractive cash flow that piques the interest of many considering purchasing an investment property, it’s really the capital growth that you should be thinking of.
Let’s say you buy an apartment for $250,000, in five to ten years, it could be worth $350,000. That’s a capital growth of $100,000. Remember though, it’s not about buying an investment property when the market is low, but strategising if it will enjoy capital growth in the years to come.
Failing to include additional costs
So, you’ve saved enough a nice deposit for an investment property. Great! But what about all the other costs involved?
These include the costs of:
- Insurance (building, landlords etc),
- Council rates, land tax and strata fees (if applicable), and
- Additional costs like repairs and maintenance (cosmetic and structural).
While general wear and tear is expected in a property, landlords can work to prevent wear and tear from becoming a big issue. Unfortunately, it involves not cutting corners with cheap repairs and maintenance.
Buying with the heart and not the head
Emotion has a lot to answer for when buying a home to live in. However, buying a property to rent out should be brain-based and strategic, not heart-fuelled.
As such, you should consider buying an investment property as a business decision.
Do this by:
- Not falling in love with the property, and
- Choose a property that will be attractive to tenants based on its low maintenance, location, included facilities and capital growth predictions over time.
After all, there’s a very high chance that you’ll never live in this property yourself.
Avoid these mistakes with professional property management in Perth
Pro Property Group is the Perth property management specialists here to help. Whether you’re a first-timer or an experienced landlord, looking in the residential or commercial markets, we have the right advice and services for you.
Pro Property Group is the Perth real estate agency who are truly ahead of the curve, full to the brim with the knowledge of the markets, what tenants want and how to make a sustainable return on investment.
Need property management in Perth?
Contact Pro Property Group today for professional property management as well as buying and selling services.