Affordability Affects Your Property Investment Choice

Can They Afford It: How Affordability Affects Your Property Investment Choice

Can tenants or other buyers actually afford the property that you’ve invested in?

And what effects does a location’s affordability have on the property and its value?

These are huge questions that you need to ask yourself before moving forward...

You may have found an amazing property that offers so many benefits to buyers, or tenants...

But if the people in your chosen location can’t afford it, it’s all for naught.

You don’t have a high-performing property on your hands.

Instead, you’ve got something that’s going to cost you a lot of money for each week that it sits vacant...

How do you avoid this situation? 

To start, you need to understand what affordability is. 

In the context of property, it’s pretty simple.

Affordability refers to the ability of people to pay for the cost of living in a property... 

Prices, mortgage payments, and rents all get factored in when determining an area’s affordability...

You may also need to consider other essential expenses, such as those for food and clothing.

All of these expenses get measured up against the average household income for the area...

The more of that income gets taken up by the expenses, the less affordable a property becomes.

What Does That Mean for Investors?

When a location has good affordability, it means that you have more interested buyers on the market. 

Simply put, people have more money to spend and they’re going to feel more confident about making the big purchases.

This increased demand pushes house prices up...

And the effect is so powerful that this increases can even happen during a market decline. 

Of course, low affordability has the opposite effect... 

The location ends up with a wary buyer’s market in which many decide to hold off until the situation changes.

That lowers demand and can negatively impact your property’s value...

Always consider affordability when making your investment choices. 

You want to generate high yields immediately.

Don’t put yourself in a position where you’re struggling to find tenants. 

If you're concerned about securing good tenants, we can help you to find the ideal property for your portfolio in areas with low vacancy rates. 

Apply today to find out if you’re a good fit to work with us.

Let’s start taking action, together.

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