sjsmith.com.au - blog

Getting your foot in the door

I get a little annoyed when I hear people banging on about the unaffordability of the Australian Property Market.  I’m a self employed person on a modest income who has managed to buy four properties.  I don't believe there is an ‘Australian Property Market’.  I think there is a Melbourne property market, a Sydney Property Market and then, a different market for every other region.  Even within capital cities there are different markets.  Currently Brisbanes’ unit market is very different to Brisbanes’ house market.  

As a first time buyer, your primary concern is finding an affordable property market.  If you can afford to buy where you want to live, that's terrific.  But if you can't, a great place to start is in one of the regional areas.  Every state has them.  Geelong or Bendigo in Victoria, Newcastle or Orange in New South Wales,  Townsville or Toowoomba in Queensland.  You get the idea.  Remember, this isn't for you to live in, this is for investment.  What you're looking for is an area with a reasonable sized population, low rental vacancies, a variety of employment options and reasonable infrastructure.  You're looking for an area that has good potential growth as well as stability.  Don't  pick somewhere with just one industry.  If there is downturn or the industry suffers, you might suffer along with them.  Check the local council website to find out if there are future projects or infrastructure plans for the area.  These signify growth and development for the area.  Check out what the local population is comprised of.  If it's mainly young couples maybe they won't want large five bedroom houses.  If it's families with children they'll want a larger property and good access to schools and family entertainment.

Shortlist one or two areas and find out what the usual prices are for the type of property you're interested in.  What are the rent returns for properties like these?

There's a lot to think about and don't feel like you have to rush. There's always another property deal!  It's also worthwhile looking for a property with something extra.  Is it on a large block that could be subdivided in the future?  Does it have two street frontage or enough room to put a granny flat?  Is there a possibility to add another bedroom by partitioning inside?  Look for ways you can value add to the property before you buy.  In the coming weeks I'll be talking about shopping for finance and some tips for saving for your deposit.

Till next time,

Sarah-Jane X