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There are many issues to consider and many traps to fall in to when buying an Investment property, be it your first, second or adding to a portfolio.
Firstly, talk to experts. On the list should be an accountant, financial planner and a property manager. The first point of call should be your accountant and working out the structure and benefits of an investment property. There are many tax deductions possible, and many structures available, where only an accountant with this sort of experience would know which is best for you and your circumstances. One great tip I have learnt over the years is that you can claim your tax deductions at the beginning of the financial year and not wait to the end. This helps enormously with affordability and your cash flow. You also have to decide what you want to achieve with your Investment property, i.e. cash flow or capital growth or both. This is an important point as it will most likely decide where you buy your property. A financial adviser can help you set your goals and head you in the right direction as well as making sure what you can afford. A property manager knows the market and can give you rental appraisals as well as let you know what particular suburbs are doing, e.g. whether there are many rental properties in the area, or the type of tenant you are likey to attract. They are also in the position to advise what the average tenant is looking for, as well as helpful hints to improve your rental return.
Research. It is well to rely on experts, but it also falls on yourself to do due diligence on what you want to buy and where you want to buy. There are many magazines and websites that one can subscribe to or visit to learn the history of a suburb as well as the prognosis for the future. Remember, "google" is your friend. It can also come down to local knowledge as well and getting a feel for a suburb and its potential. Part of your research should also be about price. Once you have decided the suburb or locale in which to buy, it is absloutely essential that you keep an eye on the market, so you know when there is a bargain or what a property in accurately worth. Research also includes due diligence when selecting a bank as well as your property manager. There is currently great competition between the banks and any interest rate saving is money in your pocket. A good property manager is also gold as they are looking after your investment. Price can be an issue for some, but service is the key along with trust knowing that he or she has your best interests at heart.