Hi All
Have been looking for second investment property we bought in Muswellbrook in 2010 and it has been great investment looks after itself has a great yield we were looking everywhere at the time getting confused when I looked at Terry Ryders Hotspotting site and looked at his Location reports and bought the one for Muswellbrook as it was only a couple of hours away from where we live .
Now we are wanting to buy again and i was wondering what type of process some of you,s go through to target an area do you buy reports as I did, go through the back of the property magazines looking at yields etc , search real estate .com with a price range friom 200k -300k for example and look at houses that may suit your criteria Anyway any suggestions on how you start the process I will be interested in reading
Thanks for your input
First part of the process is to be within easy swatting distance of the property. If you cant be within a 30-40 min drive of the property, then you make sure you have a property manager who will act like your left hand.
Second .. when is a property an investment as opposed to a nice house in a nice area? When you can purchase a place for either under market value (or perceived market value is wrong) and there is a possibility of extending, improving or upgrading the property in the near future to maximise returns and/or rentals.
Thats why you need to be 100% on what the values are for property in that area. 2br flat? 2br unit? 3 br house? If you can pull out a list of properties and be able to identify which is a deal and what is not .. you are on your way to quality investing.
So in summary .. become the expert on whats going on in Muswellbrook .. and then use that knowledge to purchase well.
Thats really all there is to it. And once you've done that .. do it again and again and again.
Oh yes .. while you are at 1 or 2 properties and a novice .. try to buy into good areas with better tenancies. Its not that bad tenancies are a problem .. but they require extra knowledge of what to do and extra finance to back yourself up on them. Which as a starter in investing you just dont have.
Thanks xdrew as i have bought already in Muswellbrook looking to buy in a different area
So what your saying I shiould consider buying 30-40klms distance as I live on the top end of the Central Coast I could look at lower Hunter the other end of the coast Woy Woy area and maybe Newcastle as I only want to spend 300k and under I could buy in San Remo , Budgewoi. Gorokan, Raymond terrace, Bolton Point for example
Then try to buy under value or do a slight makeover am I on the right track.With the exception of 1 of my Australian IP's the other 39 are all within 10 kms of where we currently live here in Brisbane.
I find if you get to know an area like the back of your hand you have a feel for the street and area before you arrive.
i like to be a postion where i can drive down a street and recalling each shop or house in a before i get to if i have only been there a few times.Thay way when someone tells me that number 48 is up for sale i can say from the comfort of the office "is that the before the corner block with the Qlder on it or the 3rd one past the bus stop".
I wholeheartedly agree about buying under market value and trying to improve the property to create equity and increased yield.
This is all i have done on everyone one of my purchases whether it was a freestanding house or a block of 18 units which we renovated doubled the valued and increased the rent 3 fold.Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
I start with exactly what you said – the rear pages of the real estate mags. I look for the trifecta: good capital growth, good rental yield and low vacancy rate. Of the suburbs that come up trumps, I ignore the new suburbs whose capital growth figure is somewhat skewed by the fact they have no existed for a decade yet. I ignore things that are not within an hour drive of a capital city or a 1min drive of a major regional city. from there, investigate what the town has to offer already, and what infrastructure is being introduced in the near future.
Jacqui Middleton | Middleton Buyers Advocates
http://www.middletonbuyersadvocates.com.au
Email Me | Phone MeVIC Buyers' Agents for investors, home buyers & SMSFs.
I go on realestate.com and just search new listings under $300,000. Properties that are run down catch my eye the most. With the places you have mentioned like: Gorokan, Raymond Terrace, Budgewoi, Watanobbi, etc… I think there is good value there. Anything you buy for under $200,000 and give it a tidy up should rent for around $290pw – $300pw.
EngeloRumora | Ohio Cashflow
http://ohiocashflow.com/
Email Me | Phone MeF@#$ THE REST WORK WITH OHIO CASHFLOW TO INVEST
There is a simple reason to be within swatting distance of the property. If you are not within a distance to be able to monitor the property, you are totally reliant on the property manager to protect .. maintain and keep you informed of the status of your property and its tenancies.
I would love to say that all property managers are saints and produce fantastic results within reasonable budgets, but then I can also say that Alice in Wonderland is a true life story. Neither are true.
The minute you DO find a good property manager you get them for four to six months and they move on … retire .. or delegate to a junior. So try to have a good property manager running your properties .. and just in case .. be within easy monitoring distance too.
For me, I also use website search engines and look for properties that fit my criteria. I think that it's a quick and convenient way for me to get an idea of a range of undervalued properties
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