I have been doing some research to decide where I should be focusing my efforts for buying my next investment property.
Of course there are all the standard variables to compare eg. vacancy rate, stock on market (incl. DSR), changes to household income, increases to rent, days on market etc.
The one variable that I'm not sure I understand how it effects my decision to buy a property as a rental is the number of properties that are currently rented in an area. For example I have been looking at 3 suburbs 2 are nearly identical in terms of median house price (one is a little higher), median rent, rental yield (given one's house price is slightly higher it has a very small reduction in yield). However the biggest variable is the % of houses that are currently rented. One has a % rented of 16.3, whilst the other is 23.9%. The third suburb has a higher med house price, higher median rent, same rental yield but the number of properties rented is 30.2%.
All suburbs are approximately the same distance from the capital city, all have very good facilities in terms of shops, schools and other infrastructure, they all neighbour one another.
Of course there are all the standard variables to compare eg. vacancy rate, stock on market (incl. DSR), changes to household income, increases to rent, days on market etc.
The one variable that I'm not sure I understand how it effects my decision to buy a property as a rental is the number of properties that are currently rented in an area. For example I have been looking at 3 suburbs 2 are nearly identical in terms of median house price (one is a little higher), median rent, rental yield (given one's house price is slightly higher it has a very small reduction in yield). However the biggest variable is the % of houses that are currently rented. One has a % rented of 16.3, whilst the other is 23.9%. The third suburb has a higher med house price, higher median rent, same rental yield but the number of properties rented is 30.2%.
All suburbs are approximately the same distance from the capital city, all have very good facilities in terms of shops, schools and other infrastructure, they all neighbour one another.