When it comes to investing in property… location is everything. It is important that your investment property is not only nestled in amongst tonnes of amenities in a desirable area, it’s also important to choose a suburb with significant growth potential. According to the experts at realestate.com.au, there are some tell tale signs that a suburb is about to increase in value and make for a great investment.
1. When demand exceeds supply
When the demand for properties exceed available properties in the area it triggers a surge in property value. In return, buyers are more quick on the draw in purchasing property in the area. A way to check if this trend is happening in your area is look at the day’s properties spend on the market. The lower the days, the higher the demand.
2. When vendors stop talking about discounts
This ties in with supply and demand. When there is a high demand and low supply, vendors will no longer need to ‘sweeten the deal’ to entice buyers, resulting in higher values in the area.
3. Auctions are more prevalent than private sales
When the market in an area is strong and there is a high demand, agents will typically opt for an auction rather than a private sale. Notice an increase in sales in an area? This usually can mean that agents are confident with the performance of the area and that a high level of demand will bring a promising auction result.
4. Low rental vacancy rate
Renting your property is the goal in a successful investment property – so suburbs with low vacancy rates indicate a higher property value. according to Jeremy Sheppard of DSRdata.com.au “When a location becomes popular, tenants will be the first to move there, which places stronger demand on rents, initially pushing them up.
Then investors wade into the market, attracted by the higher yields. And then the owner-occupiers finally get their act together. Some of the renters by this stage may decide to buy. All this buying activity now places pressure on property prices”
5. The suburbs online presence
If a suburb is getting significant attention on real estate search engines, even if there are not many properties available, this will indicate a rise in demand driving prices upward.
For more information on how to choose a suburb for your investment, call Solid Investment Property on (03)9690 2666