Investing in Property: It's All About Location

We have perhaps all the heard the statement ‘location, location, location’ a hundred times when buying an investment property. As clichéd as it is, there is a reason it continues to cycle through investment and real estate discourse.

When investing in property, location is the key to unlocking capital growth potential. It is also critical in attracting future rental tenants and determining rental return. In this way, location is tied to multiple factors that you’ll need to consider before choosing the right property to suit your needs.

Location affects property value

Properties in a great location are more likely to experience an increase in value over a period compared to properties in a mediocre area. If capital growth is what you are interested in, locations such as properties on a river, beach or with beautiful views, usually perform above average in creating capital growth. However, if you are after instant cash flow in rental return, these properties don't return much more than properties in mainstream areas.

Access to infrastructure and community facilities

If you are considering using your investment property to create rental return, it is important to imagine the kind of things potential renters will be attracted to. Some of the main factors that influence renters is the distance to amenities, such as supermarkets, public transport, highways and freeways, parks and schools. As an investor, it is crucial to think about this kind of thing, as falling into a zone close to amenities means you can widen your potential tenant pool.

Proximity to the city or CBD

Most people want to live close to commercial or business areas for easy access to work. These areas usually have a fantastic network of public transport or access to main roads. The closer your property is to a particularly good part of town means the more attention you will attract from potential renters.

Research the neighbourhood

It is imperative to research the area you are planning to invest in before deciding to settle. Some of the main points you’ll need to consider when conducting a neighbourhood search are things like crime rates and future developments. A safe area is more likely to attract renters who want to feel comfortable and interact with their community. By approaching your local council, you may be able to find out about future planning changes or developments that might affect the property value.

Although location comes with a whole lot of other factors when choosing to invest, the final decision should always come down to what you want from your investment. Your personal goals will determine what property is right for you.

At Select, we offer no-obligation, quality, and free advice to help you reach your financial goals. If you are interested in purchasing an investment property, we can advise on what loan is right for you, or if you can use your equity on an already existing property. If you would like to find out more, call us on (08) 9417 3399 to arrange an appointment to talk with one of our friendly brokers. 

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