With demand for rental properties at an all-time high, there may never be a more opportune time to purchase an investment property. Nevertheless, while the potential for strong rental returns have rarely looked better, meeting repayments in a high interest rate environment can be a challenge for investors. Here are a number of important issues to keep in mind if you are considering purchasing an investment property:
· Make sure you can cover the shortfall between rental income and mortgage repayments. Remember, rental income is likely to fluctuate from month to month as repairs and other expenses are deducted. Moreover, increases to interest rates may add to your mortgage repayments. Try and have a buffer of several thousand dollars in your current account to cover the months where rental income falls short.
· Property can decline quickly if repairs aren’t carried out on a regular basis; you will also lose good tenants if maintenance isn’t kept up to scratch. Make sure you have a slush fund available to tackle problems as they happen, and ensure you can afford to keep your property in good shape.
· Understand tax advantages associated with property investment and how to capitalise on them. In this case it is best to discuss these issues with your accountant. If you don’t yet have an accountant speak to your agent as they will be able to offer a referral.
Domain Property Advocates – Property Managers – Buyer Advocates – Vendor Advocates
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As Domain Property Advocates continues to grow I will continue to provide superior service to those choosing to use property as their investment. It is an important choice of who to choose as the one responsible to look after your property. You can be sure that Domain Property Advocates will always strive to be the best. |  |
