Investment Property Selection Process

This is the system I employ for identifying suitable investment properties

This is the Brisbane Buyers Agent Investment Property Selection Process which I have used over many years of advising people on the right property to buy I have developed a unique 8 Point Property Selection System that consistently leads me to the right property for you. It's a system that is designed to reduce risks and increase returns through rent and capital growth. Since developing this system some 6 years ago now, I have never had one property loose value, stay vacant for any major length of time and grow in value as predicted. It  works for all property types however in the case where you have requested a custom built house and land package it can have dramatic results as seen in the Salisbury Case Study.

When implemented and applied to a property, it will ensure we are buying in an area that has strong growth potential in a short period of time.

My ultimate goal before anything is to provide you with the best property solution you can ever get. A property that has the lowest level of risk with the potential to produce the highest rate of return it can achieve. Keep in mind we are spending sometimes half a million dollars and we need to ensure that investment is going to be as safe as houses.

An overview of the  8 point Property Selection System is below and will give you a guide as to how I work and how it leads me from our initial interview to finding the right property in the right area that will produce you the results you require not only now but well into the future.

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The first part of the property identification system is to establish your budget, property requirements and personal preferences. This information will automatically identify which areas to target. The budget will indicate how far from the major CBD we are going to be looking at, your property requirements will then help me determine the right types of property to search for. The final part is your preferences which is the final part to determining the right property and is fully covered off in the final stage.

The first thing I look at is any suburbs who's median house price is mid way up the price rise cycle. There is no point buying in a suburb that is at the top of it's price cycle. But if you look to neighbouring suburbs you will often find one who's median house price is much lower than one very close by. As the suburb we are comparing it to is becoming more expensive to buy in, we can safely predict that demand will increase in neighbouring more affordable suburbs.

It's important to understand the demographics of a suburb for these are going to be your neighbours or tenants. When I have completed the second part of my area assessment, the next area is too look at the demographics and understand the breakup of the population. What I am looking for is an area with a high percentage of families, specifically established and young families. From there I will examine the employment statistics and then the amount of rental properties in the area.

When the first 3 areas of the selection system have been met, we then need to look at one of the most important areas to look at. Infrastructure and it's accessibility from the suburb we are now looking at. We need to be able to access public transport so we firstly look at the distance to closest rail station and then to bus stops. From there we look at access to major areas that people will travel too and this would be the local City, Airport, Schools, Shopping, Medical and Recreational areas.

When we look at purchasing in a suburb it is very important to buy as close to the Median House Price which is the average house price, preferably we purchase below the median price. If you purchase in the top price range for a suburb you will firstly limit the capital growth potential but more importantly you will limit the amount of tenants due to the high rent you will be seeking as well as reducing the number of potential buyers when it comes time to sell. This formula reduces risk.

I know start to consider the rental return of a property and the vacancy rate for that suburb. What I am looking for is a return as close to 5% as possible and very low vacancy rate. There is no point having a rental property in an area that has a high amount of vacancies already, this is the biggest indicator of either over supply or population decrease. The demographic research has usually led us to a suburb where these factors are not a concern. The focus is now on property that can achieve the returns we need.

This is one of the final parts of the process and comes down to your requirements. Firstly and brand new home is going to have far more tax benefits than an established by way of additional items we can claim for and depreciation. If you are in a position where you need more tax deductions then that determines the type of property we look at or the returns. Generally I will look for a neutral solution where the rent covers or just about covers the ongoing property costs.

Once the previous steps have been completed, I will be shortlisting properties to inspect. I will send them to you via email and you will let me know what you think. My role is to be analytical in the selection process, your role is involve your feelings. Features that appeal to me may not to you and this is very important because if you feel that way, future tenants and potential buyers may also feel the same way. By getting your input at this time will lead us to the perfect property for you.

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Alistair treated our investment like it was his own. He understood our needs as overseas buyers, protected our interests and secured a beautiful property beyond our expectations. Even after the transaction was complete he is assisting us with everything required. Highly recommended with no second thoughts!
Grange Case Study

Kostas Dimitro

Investor Dubai
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