Location, location: What to consider before you buy
How to choose the right area to buy in? See our tips for knowing where to buy property, from buying an investment property to a forever home.
Want to know how to choose the right area to buy in? Can’t decide between city centre, suburbs or regional areas? Doing your research and identifying your investment goals can help you decide where to buy property.
All properties are NOT created equal. Some will double in price over a decade and be fiercely contested by would-be tenants, but rental returns might be low. Others will barely move in value in 10 years but enjoy handsome rental returns… along with periods of inoccupancy. Which is the better buy?
Capital Growth, or High Rental Returns: Which Is Better?
For successful property investment, that depends on the individual’s personal investment strategy and what they hope to achieve out of acquiring property. Mirvac national sales director Kathy Arici says buying within a 20-kilometre radius of a big city is a winning formula if you want capital growth at the possible expense of high returns. “Historically capital growth will happen in the cities, but your rental return might not be as good,” she says. “Whereas if you go out to the country, you might get almost zero capital growth but you get really good rental returns, up to seven or eight per cent.”
Proximity to Amenities
We all need to work, shop, eat and play, so buying in neighbourhoods that are well connected to services is a good property investment strategy. Investment success stories hinge on doing your research and buying in popular areas – suburbs that are in high demand with renters and buyers, and thus push rents and values up.
Could I Live Here?
The experts say investors should remove emotion from a purchase decision. But asking yourself Could I live here? is a good measure of whether renters and future buyers would want to live there, too. “Typically, I always look to buy something that I could live in,” says Arici, who has 20 years’ experience in the property market. Then typically most other people will feel the same way.”
Mirvac acknowledges Aboriginal and Torres Strait Islander peoples as the Traditional Owners of the lands and waters of Australia, and we offer our respect to their Elders past and present.
Artwork: ‘Reimagining Country’, created by Riki Salam (Mualgal, Kaurareg, Kuku Yalanji) of We are 27 Creative.