Whether you’re buying a new home to live in or looking to invest, today’s market offers good buying potential. Clearance rates continue to hover around 60%, which suggests that across the market, there’s currently less competition for properties than we’ve seen for the past couple of years at the start of spring.
For both owner occupiers and investors, a less competitive market may present the opportunity to get more “bang for buck” – either by purchasing a newer or larger property than they thought they’d be able to afford, or buying into a suburb that has previously been out of their reach from an affordability perspective.
Owner occupiers and investors certainly have a different set of criteria when assessing a property’s attractiveness. However, if you’ve only ever bought property to live in, you may find it difficult to evaluate a potential investment property in a rational, non-emotional way; similarly, someone who has only ever purchased investment properties may lack confidence in knowing whether a particular property is a good choice to buy and live in.
Considerations for owner occupiers
When it comes to finding a home for you and your family to live in, it’s important to assess potential properties in terms of how well they suit your family’s life stage and desired lifestyle.
Singles and couples will have very different priorities to a young family or downsizers – if you’re travelling to the CBD for work each day, proximity to public transport will make your daily commute easier; likewise, if you’re retired with grown children, being close to quality local schools isn’t likely to be important to you. If you’re buying to move in, it doesn’t make sense to pay a premium for aspects that aren’t important to you personally.
Further, if you’re planning to live in the property long-term and lifestyle is your major driver, capital growth is a less important consideration. Obviously, you want your home to appreciate in value, but if you’re buying because you love the house and the area, you don’t need to do as much local research as you might when buying an investment property.
Considerations for investors
Investing in property requires a significant financial outlay, so if you’re considering buying an investment property, you really must do your research. As an investor, your number one priority should be the return on investment you expect to receive for your rental.
Savvy investors will look to buy a rental property that appeals to as many different buyer groups as possible. Good access to transport, shopping and educational facilities (childcare, schools and universities) are aspects that are universally attractive, however, it’s important to understand the specific population demographics of the areas you’re considering buying in.
You should also look at rental supply, demand and vacancy rates as reliable indicators of the strength of the rental market in that suburb. Often, these factors may lead you to buy an investment property in an area you haven’t spent much time in, or personally wouldn’t choose to live in.
Whether you’re looking for a new home to live in or to start or expand your investment property portfolio, the team at Greg Hocking can help. We understand the local market and can provide suburb-specific advice to help you find the right property at the right price. Contact your local office today for more information.