When investing in property, much of your ‘homework’ is crunching numbers, such as:
❓ How does the valuation compare to similar properties?
❓ Can you comfortably finance the mortgage?
❓ What are the mortgage rates?
❓ What rent can you charge?
❓ Potential returns on investment?
❓ What’s the cost of complying with government regulations?
However, you need to ask some ‘people’ questions, too.
You need to be familiar with demographic trends so you understand your tenancy market.
For instance, if you want a professional couple, is the property of sufficient standard and in an appealing location? Can they park their vehicles safely? Is it near train or bus routes to commute to the CBD?
For families, are there schools nearby? Is the house on a bus route so children can get to school? Is the area safe for youngsters?
If students are your market, other considerations will apply, e.g. the number of rooms, distance from campus, sufficient parking, and so on.
Rental and demographic trends will give clues as to long-term demand. Just thinking of ‘getting some tenants in’ isn’t enough. You need to know who is looking for rental properties, where, and what they are looking for.