TOP TIPS COLUMN - SUNDAY TIMES
August 31, 2005
Trevor Dunkley Property Buyers
Agent, Property Wizards
No matter how experienced you
are, it's crucial to have a comprehensive checklist to refer
to when making a final decision on a property, or to help you
to choose between several investments.
Here are some key factors to
consider when screening properties.
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" As land is the key driver of capital growth,
you'll want to assess the land vs building ratio. Aim to
find properties where the land accounts for at least 70%
of the total value and the building a maximum 30% of the
value.
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" Consider the attractiveness of the location
to tenants. Most want properties close to transport, schools,
shops, lifestyle facilities and many want to be near the
ocean or river. "
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You'll also want to consider the attractiveness
of the property to tenants ie. does it have air-conditioning,
how secure it is, how much parking does it have? "
-
Assess rental rates of comparable properties
to ensure you'll be able to afford the holding cost. Also
consider if any reasons exist for likely growth of rental
prices in the area and for your particular property. "
-
Think about the expected maintenance costs
of the property - anticipating if they are likely to be
high or low can impact your final decision. "
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Look at the particular location of the property
within the suburb - is it in a superior or inferior location
or street? This can affect rental rates and resale. "
-
Look at the long and short-term historical
performance of the suburb, and the particular property.
If it has recently begun to do well, try to understand why
and why you expect it will continue to be a winner. "
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It is imperative to assess prospects for
capital growth in the suburb and of the property. Try to
go by facts only and consider how infrastructure, demographics,
economic and social trends may affect growth.
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