So, you’ve decided to invest your money in property – good for you! There are a range of things you’ll have to consider, but one of the most important factors in your investment’s return potential is location, location, location! The area in which a property is situated is a major determining factor in that property’s value-a two-bedroom apartment in a good location can be worth three times as much as a four-bedroom house in a less desirable one. When it comes to choosing an area for your property investment there are several factors you must consider, and depending on your long-term plans for your investment, your location needs may vary considerably.
The quick sale
If you’re planning on playing the market and buying to quickly sell again, it’s a good idea to choose an area that you believe is on the verge of a boom. Of course, this is the holy grail of real-estate and everyone would like to catch something on the verge of a boom, but if your plans are to buy and sell your way to profit there are a few indicators which could lead you to a boom area. For example, there may be a mine or factory opening nearby-this would bring employment to the area and in a lucrative industry like mining, property prices would skyrocket for the time in which the mine was active.
The solid rent-generator
If your property investment goals are to generate a steady stream of rental income without ever having to search too hard for tenants, you need to consider buying somewhere near a university or close to the city. A university is a constant source of people who need to live nearby and are not in the position to buy, so if you choose property close by there will be no shortage of tenants.
The sure bet
If what you are looking for from your investment is a safe, steady asset that will retain its value and grow over time, there are several areas to choose from where this is the case, but be prepared to pay a big premium-and once you’re into the market in that area, STAY IN!
The Gamble
There are certain areas that begin as working class or rough areas that have the potential to become high-value areas over a longer period of time. Places close in to the city are usually good candidates for this, and just a little attention from the council in the form of a makeover can usually do the trick on these locations. On the other hand, sometimes areas stay ‘dives’ forever, in which case you’re stuck with a house at the dodgy end of town…
The decision of where to purchase property is never one to be entered into lightly, and the best way to prepare for it is to arm yourself with as much property investment advice as you can and hope that a combination of luck and good research leads you to the money.