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Trying to guess where the next real estate boom town will be is difficult. It really is a guessing game. When you are looking to invest in property, it may pay you to simply look for the basic identifiers of a good location and then due you due diligence on specific properties rather than spend your time ?guessing? on areas that might, or might not, boom. So what sort of key indicators or factors might you look for? Here are a few tips to help you find that next property investment location: Firstly, know your strategy. This is a crucial step that you need to be clear on before moving forward. You should understand your goals for investing as this will determine the sort of property you will be seeking, which may also influence where you should be looking. The second factor is also related to you more directly. Know you borrowing capacity and your property budget. This will be a major influence over the locations that will become your target. We may all want to buy a property in the ?best? suburb, but is it realistic for our budget and within our strategy? The next set of factors are related to the location and the property itself: Rental Yield - rental yield is the income from the property divided by it?s value, expressed as a percentage. As a very rough guide, yields above 5% are a good place to start. Population - is the location big enough to sustain a good rental market? Is the population growing or declining? Vacancy Rates - your investment success will require that the property maintain a steady income. You can assess vacancy rates in your target area online or in property magazines. Capital Growth - does the area have a good track record of recent and long-term capital growth. Of course, capital growth data is historical and does not forecast, however, looking at long term trends may be useful. Location Services and Facilities - parks, water, shopping centres, schools, public transport, cafes and other services and facilities increase the attractiveness of an area to an investor and this also can translate into increase property values and increased rental yields. Plans and prospects - are there plans for the area that see it growing and increasing it?s appeal? Development and infrastructure plans can usually be obtained for local councils as well as state and federal government. Age of the property - if you are looking for depreciation benefits then the age of the property may be a very important factor for you. So there are some tips to help you choose your real estate investment location and property. Rather than guess the next boom town, undertake some research. This will help you to make a profitable purchase and reduce your chance of losing out. You can read more about australian property investing and residential property investment at www.everydaypropertyinvesting.com
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