You might face a lot of challenges when it comes to property investing that is often overlooked by new investors. You could easily buy investment property Melbourne if you do proper research.
Take a look at some of the challenges you might face which are usually overlooked by new investors.
- Long term Outlook: Property prices keep fluctuating and there is a risk that
if you are not careful, you might end up making a poor investment
decision. Investors should have a long-term focus on investment strategies. The
critical part is that you get value for money when you buy the property. Look
for discounts when you plan to buy any property to gain instant equity on
the competition of your sale. This would protect you against a drop in the value of
property in the short term.
- Interest rates: It can make a huge impact on your investment. You can expect some inflation control measures and an increase in interest rate. To counter this, you have to aim to secure the fixed-rate mortgage or budget for increased repayments.
- Void periods: You cannot get away from this. There will be a void period when no tenant is living in your property. In such times, you should cover the cost of mortgage repayment, council tax and other bills that are associated with the property. As it would
be costly, you should aim at making the property the one that renters would
love to stay for a longer time. You can also build an allowance for this in
your budget. A good agent or property manager would do everything they can, to
keep the shortest void period possible.
- Challenging tenants: Many people worry that the tenants would wreck the property and leave it in a condition that needs significant refurbishment. While this could be the case, the majority of tenants would leave the property in a good condition. The tenancy agreement should explain that render should leave the property in the same condition as it was when they had moved in. Proper allowance should be given for fair wear and tear but money for redecoration and cleaning should be claimed from the tenant’s deposit.
- Investment Area: The fortunes of the area where the property is located, could go up or down compared to the rest of the country. You could look for properties in areas where the economy is based on more than one or two industries.
All the above-mentioned challenges are why you should hire a property investment agent. Most people would hate to deal with any of such challenges. It means the investors
understand the challenges and are focused on the long term where there would be
a lot of opportunities. Property investment is not as easy as it seems to be.
There are a lot of risks and advantages that are involved in it. Investing in
the ideal property would become much easier when an expert in the field suggests
you to invest in a particular property and to be cautious with some other
property investment.