Do your home­work and think about the renters when buy­ing an in­vest­ment prop­erty, re­ports

Ben Hyde.

The Advertiser - Real Estate - - Front Page -

THE worst house on the best street is of­ten viewed as real es­tate gold but ex­perts say the adage is not nec­es­sar­ily the best ad­vice when buy­ing an in­vest­ment prop­erty. Newer homes are largely rec­om­mended when it comes to a prop­erty that will of­fer in­vestors the best chance of se­cur­ing good tenants as well as max­imis­ing the tax ben­e­fits.

The In­vestors Club chief ex­ec­u­tive of­fi­cer and founder Kevin Young says fail­ing to do your home­work on prop­er­ties can be costly.

‘‘The most com­mon set­backs for in­vestors are a high cost of re­pairs and ex­tended va­can­cies,’’ he says.

‘‘Both are prob­lems that stem from a bad prop­erty choice, cost­ing you money and your con­fi­dence, too.’’

Mr Young says bud­ding prop­erty in­vestors need to be shrewd.

‘‘It’s im­por­tant for in­vestors to be savvy in their pur­chase, look­ing out­side their own ar­eas and in mar­kets across the coun­try for ar­eas fore­cast for strong growth,’’ he says.

‘‘In­vestors need to have a busi­ness mind and look for fea­tures at­trac­tive for a ten­ant, not for them­selves. Buy­ing on emo­tion is one of the big­gest mis­takes in­vestors make.’’

Brock Har­courts Ade­laide Metro Prop­erty Man­age­ment man­ag­ing di­rec­tor Adam Blight says buy­ing new is usu­ally the way to go.

‘‘A low-main­te­nance and a tidy place is pretty vi­tal,’’ he says.

‘‘It needs to be some­thing that will be at­trac­tive to the sort of tenants you want. New houses also have bet­ter tax ben­e­fits.’’

Mr Blight says a unit also may prove a bet­ter op­tion than a house.

‘‘There is de­mand for both but with units you will gen­er­ally get a bet­ter yield be­cause you are not pay­ing for the land,’’ he says.

Mr Blight says, like any prop­erty pur­chase, lo­ca­tion is a key.

‘‘You want it to be close to all the ameni­ties: pub­lic trans­port, schools, shops, re­serves. Closer to the city is ob­vi­ously an ad­van­tage as well,’’ Mr Blight says.

Terri Scheer In­sur­ance man­ager Carolyn Ma­jda says the less main­te­nance, the bet­ter.

‘‘A prop­erty that re­quires as lit­tle main­te­nance as pos­si­ble will make life much eas­ier for both tenants and land­lords as it will min­imise the ef­fort and cost in­volved in the up­keep of the home,’’ she says.

‘‘If you do have a gar­den, en­sure it is safe, land­scaped and as low­main­te­nance as pos­si­ble.’’

Liam Kurk­patrick bought a unit at Gil­ber­ton as an in­vest­ment prop­erty about seven years ago.

He says buy­ing in a de­sir­able lo­ca­tion has proved a win­ning choice.

‘‘I’ve only had two dif­fer­ent tenants in the seven years,’’ he says. ‘‘It’s a great lo­ca­tion and the re­turn is good.’’

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