What to Know Before Buying Property in Melbourne Suburbs
So you’ve decided to get into real estate and you’re beginning the preparations to acquire your first property investment in one of Melbourne’s suburbs. You’ve got professionals or families in mind, who want a home situated in an area that’s serene where they can relax after work. At the end of a long day, they don’t want to be reminded of the office with the sights and sounds of a skyscraper jungle. That makes the middle to outer ring suburbs the perfect location for a home. Plus, there are often more opportunities in terms of availability, value and dwelling types beyond the city fringe.
The number of complexities is high however, regardless of where you invest. No matter what property type you choose, acquiring your first is always daunting, especially if you’ve had no experience in the field.
Basic Tips for Your First Property Investment in Melbourne
Beware of biased advice.
Estate agents, marketers and other professionals will have a sales commission waiting for them the minute you sign that contract. These real estate pros like to give “help,” making it seem like you’re getting a good deal from their “free advice.” That leaves you robbed of the possibility of getting unbiased advice that could have led you to a different property with better potential to grow in value.
Property investment in Melbourne’s suburbs, particularly within close vicinity to the city can have good rental yields as well as capital growth but each property needs to be assessed on a case by case basis. In recent years, many properties have attracted strong attention from investors. To get the best value for your investment, consult with an independent buyer’s advocate. If you’re unsure whether the real estate professional you’re working with is unbiased, ask them about their income source and understand that if they are being paid by the seller, they don’t represent your interests in the purchase transaction or property recommendation.
Assess your risk tolerance.
Investment will always call for a certain level of risk but as properties differ, so does the level of risk. To identify which is the best match for you, assess how comfortable you are with the chance of a loss in relation to the relevant level of gain. Once you know your tolerance level, study each property you’ve considered investing in. Carefully compare your risk comfort level against the riskiness of every property. For example, developing is high risk for potential high return. If you aren’t comfortable with high risk, then don’t develop Consulting with an independent buyer’s agent will ensure you get the right evaluation.
You should also consider the amount of debt you can handle, from current finances to lifestyle adjustments you’d be willing to make as you redirect a portion of your disposable income to pay off debt. Property investment in Melbourne suburbs may not be thought of as high risk because of the attractiveness of the city and population growth, however not all property is investment grade and worth of buying.
Be honest about your real estate experience.
Your buyer’s agent is better able to guide you in choosing an investment property in Melbourne, if they know about your level of experience in real estate. The industry is comprised of many technical terms and complex processes with multiple stakeholders including building inspection and legal firms and property managers.
Being upfront about your technical know-how, experience in real estate and investing will ensure professionals can determine how to best aid you from the beginning. Due to a high level of competition from other investors, it’s best to be clear from the beginning.
Consult professional help.
Even with a cooling off period to examine a contract, avoid going through it on your own. If you want to buy property in Melbourne, seek the help of a conveyancer or solicitor regarding legalities. Contracts were drafted by the vendor’s party so there’s always the risk of signing a deal that benefits their party more than you. Getting assistance from a legal professional provides easier identification of unfair terms or conditions and provides the added benefit of proposing conditions in your favour for a fairer deal.
Never rely on what you are told or see alone. Structural problems lie hidden behind walls and deep in the building’s foundation. Property investment in Melbourne’s suburbs is expensive so get the property inspected by building and pest inspectors so you know for sure it’s worth your time and money.
Once you’ve purchased the property and made any necessary renovations, you need someone to make sure it stays in tip-top shape. Hire a licensed property manager you can trust. The same amount of thought and care to choosing one should be similar to hiring a baby sitter or a tutor for your own child.
Going into real estate for the first time is exhilarating and can be nerve-wrecking. There’s a mixture of feelings, the possibility of getting huge returns, the worry of the financial burden while maintaining your investment, and the whirlwind of jargon and procedures. Start by aiming to make the experience as stress free as possible by teaming up with the right experts when making your first property investment in Melbourne.
For more information or to discuss your property investment plans, call or contact our expert team today.