How do you know if your investment property is in a good location?
You’re looking for high yields from day one…
And you want to achieve high capital growth over time…
Combined with your value adds, that’s how you get the high performers that move you closer to financial freedom.
If you pick the wrong location, you put yourself at an immediate disadvantage…
Avoid that issue by following this five-step strategy.
Step # 1 – Check the Days on Market
The higher the average time to sell, the less likely it is that a location can offer high performance property…
Compare the suburb’s average against the nearest city’s average-
If the number’s lower, you’ve found a location that’s in demand
As a result, you’re likely to attract more interest from buyers.
Step # 2 – Consider the Vendor Discount
A vendor discount is the difference between the seller’s original asking price and the price they end up accepting.
You’re looking for as low a percentage as possible.
An average discount of 4% or below suggests that there’s a lot of demand in the location…
As a result, vendors don’t have to lower their asking prices to achieve a sale.
Step # 3 – Check the Open Homes
Open homes provide a great “at-a-glance” perspective into how much demand there is for property in a location.
When a home’s subject to a lot of viewings, motivated buyers feel more compelled to make an offer…
They may even make higher offers due to the perception that there’s a lot of competition around.
Step # 4 – Figure Out How Much Stock is on the Market
Prices tend to go down when a high percentage of a location’s stock is on the market..
This suggests that supply outstrips demand, which means sellers may have to offer discounts…
However, you may have found a high performance property if it’s in an area where less than 2% of the stock is on the market.
Step # 5 – Check the Rental Market
Tightening of the rental market ends to indicate that an area’s becoming more desirable…
Better yet, renters tend to respond to changes in the market faster than buyers.
You can get ahead of the curve if you keep an eye on this metric.
These five steps can help you find a high yield, high growth property with potential for value adds.
But you may need a little guidance.
Dashdot can help.
Just apply online today to see if we’re a good fit, so we can help you find your very own High Performance Property.