Investing in the Right Property Now!
for financial advice services.
See destinylive.com.au for
property management tracker (free for 1 property).
See also 20
Must Ask Questions for Every Property Investor, Margaret Lomas .
Destiny FinSoft is available for download on the www.destiny.net.au/
web site. It includes a number of calculators for doing one-off
calculations. These include depreciation, tax, loan and borrowing
capability calculators. It also includes a built-in web browser for
accessing the Destiny web site and the ATO, but not general web
sites since the URL bar seems to be uneditable. It appears to be a
tool targetted at a Destiny consultant visiting a client.
Determine if the gross regional product for the area (esp. local
council) is above the gross domestic product.
Does the property have everything going for it? (Refer to "20
Must Ask Questions for Every Property Investor")
- see that more than one significant employer
- see council web site for economic brief, census data and
demographic information (but only if more current than 4 years)
- predictions for jobs growth
- check housing industry information
- Cash flow for the property.
- Is there a low vacancy rate for the area
- Are there funded infrastructure projects in the area
State and local government (presumably info from govt web sites)
Carefully distinguish between funded and planned projects
- Is there positive population growth for the area.
(Local council should have population projections)
- Is there a lot of other development going on, or planned, that
will lead to an over-supply of rental properties.
- What are the trends for the area, and has the area already
Are there good economic indicators for the area
- If the growth trends have been high for a while, are there
still reasons for this to continue
- Have rents in the area already gone through a growth period
Is there a town of size at least >50000 people within
30mins drive, and local town has >5000 people
Is there more than one industry in the area. A single
industry/plant supporting the area lads to high risk.
Is it a niche market (tourism, retirement village, student)
where the size of the market is smaller and perhaps riskier
Is the property a good fit for your personal risk profile
(refer to the Destiny web site for calculator)
Will banks etc lend for property in the area? (small towns and
niche markets are problematic)
What is the market value for the property compared to the
asking price. Slowly bid towards the market price irrespective
of the asking price).
- Are there businesses in the area, is the commercial premise
vacancy rate low (indicating business doing well in area)
- Are the residents in the area stable (see if they stay for
at least 5 years)
- Is the council 'go-ahead'?
- Are there too many rental properties proportionally (ideal
is 70/30 owner/renter)
- Employment rate between successive Australian Bureau of
Statistics census data
- ABS data for median household income should be not lower
that CPI. (Doesn't have to go up)
Who was the builder/developer?
- Is this being sold via an unconventional agent?
Is there a rent guarantee? (if so, run)
- Are they still around?
- Is there still a warranty?
What property management arrangements are available
- (Ditto for NRAS. Defence Force Housing may be OK)
How old, and in what condition is the property?
- Are there restrictions like strata title, body corporate,
hotel/unit management agreements
Is it tenant friendly
- Is depreciation scales available
- Are there big expenses coming up
- Are there high expected on-going maintenance costs?
- Remember to have a professional inspection and contract
subject to this
Is the title on the property 'normal'?
- Are they likely to be frustrated
- What was the tenant turnover with the previous owner (if it
was previously rented)
Do the numbers add up for the property?
- Are there restrictive covenants