If you are planning to buy a property to rent out, then you will most likely have a different agenda than if you intend to live in the property. An investment property needs to be a wise investment as opposed to one that provides you with a home and a roof over your head.
Like any investment, the figures need to stack up for the sake of profitability. Pick the wrong property and your hopes of enjoying any generated income could be dashed. Regardless of your end motive, it pays to do your homework as there will some factors that apply to both types of investment.
Firstly, you should buy from a reputable developer to ensure the property’s longevity. Many well- known developers have a portfolio of previous projects, making it easy to check their track record of quality and workmanship. Location is as important as ever, but the location is likely to differ for a buy-to-let property rather than for your own use.
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For investment purposes vicinity of mass transit networks is imperative. Tenants will want a quick commute to their workplace or even where they like to socialise.
Whereas if you are buying a property for your own use, you may want to be closer to family or the airport if you travel a lot. A big house with a garden may be suited to your plans to have a family, but a tenant is more likely to favour the convenience of a condominium in the center of the city.
If you are buying your dream home, you are may not be shy to get stuck into some home improvements. Replacing bathrooms or kitchens will allow you to place your own stamp on the property, making it exactly what you want to be. This will also increase its value too. However, tenants will want to move into a property that is already done so you will need to consider any work ahead of renting.
Remember tenants will want to live somewhere hassle-free and a landlord will want a property that is easy to maintain to will incur minimal maintenance fees that will not cut into potential profits.
Should the end goal be to receive capital appreciation on the property, then think about buying in an area that is expected to increase in value. Research to see if the local government has earmarked any areas for regeneration or any impending infrastructure growth.
Tenants may not be quite so keen to live in an area that is yet to be well established, so anticipate receiving lower rents during this period, but if the property is for your own use, enjoy this lower price tag the property came with until the area improves.
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