Thinking beyond price for investment properties
Category Buyer Advice
What to look for when choosing an investment property.
When you're choosing an investment property, the same "rules" about location, condition, and security apply as when you are purchasing a home for yourself.
That's the word from Berry Everitt, CEO of the Chas Everitt International property group, who says that there has been an increase in buy-to-let purchased this year due to volatile equity markets, relatively low interest rates and banks being eager to lend on residential property, despite slow rental growth rates.
"An oversupply of new units in many popular areas and negotiable prices are also drawing investors back into the market, but they do need to remember that while price is important, cheap is very seldom best. The area in which a property is situated, its overall condition, and security considerations must all be considered when acquiring a home.
"Depending on the area and your tenant target market, other factors that will make your investment more attractive to potential tenants are good schools within walking distance, convenient shops, and health, entertainment, sports, and public transport facilities. In holiday or resort locations it is important to remember that the most sought-after rental properties are always those closest to the main attraction, be it a beach, mountain, hot spring, or game reserve."
Finding the right property and reliable, creditworthy tenants, he says, should never be left to luck. "Prospective investors should seek out a qualified, experienced, and reputable estate agent to help them evaluate the soundness of any proposed property purchase, and to help qualify prospective tenants.
"Over the medium to long term, they will also need to be certain that the property is well cared for and maintained and that the rent is paid on time. This is where appointing a specialist to manage the investment is crucial."
Writing in the Property Signposts newsletter, Everitt notes that few investors are prepared or able to be full-time landlords and that this responsibility is best delegated to an experienced, well-briefed rental agent based in the vicinity of the property.
An agent will be able to deal objectively with tenants who don't pay, or ones who damage the property, and they will also have a trustworthy network of competent contractors to carry out any necessary maintenance or repair work.
"An agent who specialises in managing rental properties will ensure that the investor receives ongoing professional advice on the ever-changing laws and regulations that govern landlord-tenant relationships, and on compliance with municipal regulations."
Issued by Chas Everitt International
For more information
Call Berry Everitt on
011-801-2500
Or visit www.chaseveritt.co.za
Author: Chas Everitt