Investing in real estate can be incredibly beneficial if you can find the right property to suit your needs. Whether it’s a future family home or an investment opportunity, knowing what to look out for and what will most likely benefit you the most in the long term is crucial. Gathering the right information to perform the correct research can help you make an informed decision in regard to your property. From this, a property valuation is always the recommended to ensure that you’re paying the correct price for your next property.
Here are a few tips that will help you guide your research as you sift through property’s while understanding the market:
Sort out your finances
Your budget is everything and is not something that you should compromise on. Sitting down and working out what you can realistically afford is the first thing you should do before even beginning to look at properties. This might mean understanding your current equity, your expenses and income. Having the money for a deposit is one thing but being able to realistically make mortgage payments every month is something that can’t be overlooked. Be sure to also take into account the sneaky addition of stamp duty when purchasing a property, this will save you a nasty surprise.
When you have clear understanding of what you can afford, you can then begin to determine what your mortgage and house price budget is. Be careful not to compromise on this – your budget will help outline the size of the property and what areas you can afford.
Understand what kind of property you want
Whether it’s a two storey free-standing house, a commercial premises or a two bedroom apartment, the type of property you want will also help guide what you can afford. It’s also a great way to weed out what you want out of the property and what you actually need. From here you can decide if this is going to be your “forever” home, a short term plan, or long term investment.
In the wider scheme of things, this could also mean tossing up between investing in residential or commercial real estate. Deciding on what kind of property you want will dictate what you want to get out of the property. If it’s for investment purposes and you’re tossing up between commercial and residential. With that being said, while you might get higher returns in commercial real estate, residential purchases require less of a deposit – these are all things that need to be considered.
Know your location
Once you know what you can afford and what you’re after, you can begin to sift through what location is going to suit your needs. This might be tricky, especially if you have your heart set on a location and its average home prices are out of your reach.
While location is usually more of an emotional investment, especially if you have your heart set on somewhere in particular, choosing your location has to be done realistically. It might mean a longer commute to work or some compromise, but property prices are largely driven by its location.
If it’s commercial real estate that you’re investing in, the location of the premises will also drive up prices depending on its accessibility to foot traffic, population, and public transport. To ensure a good return on investment, you need to research factors like, vacancy rates and local comparable prices to gauge if it fits within your budget.
Also look into median property prices and calculate the average amount of days a property stays on the market – this will give you a good indication of how strong the local market is.
Know your property
Now that most of the external research has been completed – you know what you want, what you can afford and decided on the location – you can begin to really inspect your next property.
Upon inspecting the property, you need to make sure you don’t put all of your eggs in one basket and be realistic. Don’t let yourself make compromise on the smaller issues that might turn into big issues down the track. With that being said, make sure the electrics are in check, the plumbing works, foundations are sound and determine if the asking price reflects the condition of the property.
This is the most crucial stage of the process, you don’t want waste time emotionally investing in a property if it’s not going to suit your long term or financial needs. Furthermore, with a pending mortgage, you don’t want to compromise on things that will likely put you out of pocket in the future.
When it comes to researching a property, make sure you do your own thorough research before making a decision. Looking to buy a home can take months of looking at multiple properties and it’s definitely a decision you should make light heartedly.
If you’re looking to buy your next home or investment property, then seek out a professional house valuation Melbourne expert to help you. A professional valuer will do the research for you and take into account objective data, comparable sales, and any other variables and risk factors that can affect property value. From this, they will provide you with a detailed valuation report that will correctly identify the accurate value of your next property at its current market value.
If you require a property valuation for pre-purchase advice, then seek out one of our expert valuers to help you with your next property related decision.