Robin has been investing for a little while now and has bought in excess of ten houses. Here are a few points he likes to consider when searching for an investment property.
1. Rental income
Rental income is the cash flow received from the tenant paying rent. In an ideal world, rental income would cover all costs and then some.
Some costs that Robin likes covered by the rent:
- Interest rates
- Insurance
- Property manager
- Rates
Costs should be calculated beforehand. It’s important to know if the property will be cash positive.
2. Good structure and easy to maintain
Robin likes to buy New Zealand properties from the 1940s to 1970s as he feels renovations and maintenance are easier. A lot of weatherboard properties from this era had good bones. Obviously the depreciated cost helps with the pocket.
Renovations
Be on the lookout for property that is cheap and easy to change cosmetically. Adding value can increase the worth of the house.
These simple renovations that help the appeal:
- Kitchen
- Bathroom
- Paint job
- Adding a deck
3.Location, location, location
A phrase frequently echoed in the real estate industry. In short, location matters; a lot. A location that has a lot to offer can mean less vacancies.
Consider the following places of interest:
- Entertainment & recreation places
- Shops, cafes, eateries
- Transportation hubs
- Schools & universities
- New developments
Less deposit for rentals?
Rules have changed meaning that it is easier to purchase an investment property with less equity. If you would like to check if you could buy multiple properties with 20% equity across them – create your mortgages online account here to get the ball rolling.
If you want to read 5 important things to consider before investing in property click here
