Research a vital investment tool

SHARE market volatility has prompted a cautious approach for many investors, with the “safe as houses” philosophy leading many to sink their money into property.

And while it is hard to go wrong buying into property, a little research can make the difference between an average investment and a highly successful one.

The trick to a good investment, according to experienced investors Tracey and Paul Magiatis, is finding a property in a high growth area that people will want to rent.

“There are suburbs in Perth, like Peppermint Grove and Claremont, that always perform well in terms of growth and are good to invest in,” Mrs Magiatis said.

“But if you can’t afford to buy into those then you do more research and look for a suburb which, although it may not have had fantastic growth in recent times, for some reason is expected to get a kick start soon.”

State and local government plans for the area, such as new roads or urban redevelopment plans, should be thoroughly researched.

“A good example is the eastern corridor, as in Belmont and Lathlain, which was previously a little unloved. But since the Graham Farmer Freeway went through the area has recorded great growth,” Mrs Magiatis said.

The Investors Club WA branch president Barry Atkins agreed and suggested another major infrastructure project, the extension of the Kwinana Freeway, was likely to make the far southern suburbs a lot more appealing.

“That suburb is only 35 minutes out of the city now and it is also close to the beach,” Mr Atkins said.

Distance from the city was another big factor in choosing an investment property, according to Mr Atkins, and the closer, the better. New apartments going up in the heart of the central business district were likely to make good investments, especially with the new Perth Convention Centre on track, he said.

But whether the property was an apartment, villa, unit or three-bedroom house, the key to its success was rentability, Mrs Magiatis said.

“Some investors still buy with their heart, even though they know they won’t be living there, and that is the wrong approach. You have to think what a person would want to rent,” she said.

“People want to see security windows or an alarm because security and safety are big issues these days ... air-conditioning, because Perth gets very hot in summer a dishwasher. And, if possible, two bathrooms.

“The garden should be low maintenance with a small, or no, lawn and if there is a garden then it should be reticulated and filled with native plants that don’t require much care.”

Mr Atkins also suggested a neutrally coloured interior, with perhaps one feature wall. “All these facilities add appeal to the property and mean investors can charge more rent,” he said.

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