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What to look for in an investment property

29 Nov 13

Real estate is regarded as one of the best ways to invest your money.

When considering purchasing property to rent out to others, there are several things you should be looking for. Follow this real estate advice to make sure you make the right decision.

Check out the market

A good real estate agent should be able to advise you on the ideal market conditions and neighbourhoods in which to buy. You'll want a property that provides long-term capital growth with the potential to increase in value every few years.

While a neighbourhood may be particularly popular currently, that doesn't mean it will continue to increase in value in the long term. Check out "up and coming" areas that may be more affordable now but can rapidly increase in value over time.

Know what you're looking for

It's a good idea to have a list of criteria that you want your rental property to meet. Whether it's location, property size, number of bedrooms or perhaps even the potential for it to be lived in by your own family one day, know the kind of place you're looking for before you set off.

You may come across something that surprises you and encourages you to step outside this criteria, but if you narrow down the search field at the start it will likely save you time and effort.

Figure out how to add value

If your budget is small or you're just starting out in the investment property market, you may want to start small. That doesn't mean your house can't increase in value, however. Sometimes a few simple renovations can lift the market value of a home significantly, so this is a great option if you're handy with a hammer and a paintbrush.