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How to Buy Investment Property in Melbourne
When it comes to investing your money, most people agree that real estate is the way to go. While owning your own home is an important first step, it doesn’t have to be the only place that you own. Buying investment property in Melbourne or another Australian city puts your cash to work in a way that will leave you with a portfolio of permanent assets. At Ironfish, our experienced team can show you how to buy your first investment property.
Location, Location, Location
The first thing you should consider in buying your investment property in Melbourne is the location. Renting out commercial property can be very challenging since businesses don’t move very often. For your first investment, we suggest starting with a residential property such as a house or an apartment. Look for places that will most likely be in demand, such as near the waterfront or close to the employment centres. Going further out into the suburbs may cost less up front, but it may be harder to find tenants and the rents you can charge will be lower.
You should also avoid neighbourhoods that are already in fashion. These areas will already have peaked in their value and won’t increase as quickly. Instead, look for areas that are due for an upswing, or neighbourhoods that have new infrastructure being built that will make it easier to commute.
A Floor Plan Everyone Loves
Once you’ve found your suburb, it’s time to find the right investment property. Some people think of real estate investing as ‘house flipping’, when you purchase a rundown home for a low price, fix it up and sell it at a profit. But most people don’t have the requisite knowledge, experience or time to make this work. Instead, Ironfish recommends that you look for turnkey apartments that are tenant ready.
Even better, look for property in new buildings. A new apartment or home doesn’t come with any hidden baggage or problems, and by definition will offer the open and modern floor plans that most tenants will want. You want to make your investment property as easy to fill as possible – which is especially important when you are building a portfolio.
Spreading Out the Risk
The real secret to buying investment property in Melbourne is buying investment property in other cities as well. At Ironfish we recommend diversifying your portfolio by purchasing properties across a range of cities. That way when one city is affected by the normal dips of the market, your other properties will carry you through.
Your experienced Ironfish team can help you time your purchases, blending long term appreciation properties with units that will earn you rental income right away to pay down your loans faster. Once your loans have been paid out, your investment properties in Melbourne and beyond will help to grow your wealth and generate income for you and your family for decades to come.