When it comes to investing in real estate, it is important to have a competitive edge. Australia's ever changing property market keeps investors on their toes in search of emerging 'hotspots' with potential returns.
Understanding the key driving factors for growth are imperative for success when analysing markets before they fully mature. Identifying a hotspot involves recognising a suburb or location experiencing significant growth, offering long term capital appreciation and robust rental yields. Your assessment strategy will depend on individual investment factors and whether you choose to focus on capital growth, positive gearing or a combination of the two.
So what are some of the factors to consider?
UNITS VS. HOUSES:
Units often boast higher gross rental yields due to affordability, but additional costs like strata fees need to be considered.
Landlord insurance needs to be factored in as it is vital for liability claims and potential injuries on the property.
REGIONAL VS. METRO:
While properties in metropolitan locations currently show higher rental demand, regional areas are still witnessing a surge in interest, driven in part by the work-from- home trend.
TRANSPORT, SCHOOLS AND AMENITIES:
Proximity to quality schools, recreational facilities, healthcare services, shopping centres, and transportation hubs enhances a location's desirability. Future value can be influenced by ongoing or planned projects that improve a region's amenities. Other considerations might be proximity to beaches and national parks, as well as the walkability factor. You can research your preferred locations by looking at suburb reports via Domain, realestate.com.au or Century 21's instant suburb report C21.com.au/suburb-report/
Whether a seasoned investor or a newcomer to the property market, considering these factors will allow you to make more informed investment choices.