3 Important Factors When Choosing A Location For Your Property Investment
Property investments are a very popular strategy right now because they have the potential to be incredibly profitable. However, a lot of people get the wrong idea and think that buying a property is always going to be a good investment choice, regardless of what you buy, and that just isn’t true. There are a lot of different factors that affect the success of a property investment but the location is always the most important thing. You could buy the nicest house in the world but if it’s in a poor location, you’ll still struggle to find tenants or even sell it on. If you’re in the market for a property investment, here are a few simple things to consider when deciding on a location.
Look For Growth Areas
If you buy a property in a popular area, you’re going to pay a premium for it. You’ll be able to charge more in rent but you need that initial investment, which a lot of people don’t have. But if you look for growth areas and get in on the ground floor, you can get a good price on a property that is going to increase in value over the next few years. Look out for development companies like HH Properties and Peter Hall who are putting money into up and coming areas. If you can buy a property in one of these places while prices are still low, your returns will be a lot higher. However, it is always a bit of a gamble and it’s important that you do your research properly to ensure you don’t end up stuck with a property in a place where nobody wants to live.
Know Your Tenants
When you’re buying a property to let, it’s important that you know who the tenants in the local area are because that has a big impact on the type of property you should buy. For example, if you’re looking to invest in a small studio apartment, you need to find a location that has a lot of young working professionals. If you buy a small apartment in an area that is filled with families, you’ll have trouble finding tenants. Often, it’s best to consider the tenants first and find a property that matches them.
This isn’t something that people tend to consider but it’s important because it could lead to a lot of maintenance costs. If you buy a house in a flood risk zone, for example, you have to be prepared for the property to get damaged and you’ll have to cover the cost of pumping that water out and dealing with any damp and that can get expensive. That doesn’t mean you should never buy a property in a risk area because you can save a lot of money, you just need to weigh up the risks and decide whether you’re prepared to deal with them or not.
As long as you think carefully about the location of your property and remember to consider these things, you should be able to make a sensible investment.