How do you research property?

albanga

albanga

Hey All,

Apologies if my topic is quite vague but I am new to real estate and just trying to absorb as much information as possible over the next year whilst I attempt to build enough equity to purchase my first IP.

What my topic is referring to is how people go about researching property? So far I am using tools such as forums, investment magazines, investment websites, realestate.com and just general google searches.

Whilst these tools are fantastic and I have already learnt so much I am really interested to see what other people do or if they have some specific websites. I guess a concern I have is that once something is published in a blog or listed in an investment magazine or even discussed in a forum that the boat may have begun to sail.

Before it has started to sail though there are obviously investors who are well aware and I guess I want to get more knowledge on how they get the inside word. Things such as infrastructure and developments will increase an areas value but I struggle to know what my local council is doing let alone finding an IP in another state!

And just a side note on realestate.com if you go to the investment tab and click say Melbourne the highest rental yield is Carlton but that does not mean everyone should run out and buy in Carlton. There are obviously a lot of factors to consider but how do people go about determining this as opposed to just going for the highest rental yield.

Thanks in advance:D
 
I bought outer sydney crunched numbers for a unit and townhouse.

Next to improve yield bought a couple props and added grannies. The areas were not hotspots but have jumped since. I have continued purchasing using equity. Looking for new deals now. I still have not maxed land tax in NSW, but am looking to add to interstate portfolio.

I bought where the numbers worked and cg has followed. I have not chased perceived hotspots posted by Ryder and the like. Where I purchased was not in their list.

Pick an area and take the plunge. I am a positive cash flow investor who buys outer suburbs properties in capital cities and also have received decent capital gain. My first two I could have done better, however they have increase by one third each in value since purchase.
 
albanga said:
And just a side note on realestate.com if you go to the investment tab and click say Melbourne the highest rental yield is Carlton but that does not mean everyone should run out and buy in Carlton. There are obviously a lot of factors to consider but how do people go about determining this as opposed to just going for the highest rental yield.
Click to expand...

The yield is likely done on gross rent vs purch price. What it probably (someone correct me if I am wrong) means is that NET yield is much lower.
e.g. once you take into account owners corp, management (if student accomo - which is very popular in Carlton), your yield could be pretty low.

The Y-man
 
For our last couple of purchases, we looked for

1. Affordability - not just for us, but for the "average" homebuyer. So in Melbourne, we said $300k is likely more affordable for a family than $600k. Aim was for relative liquidity if needed to sell. First cut.

2. Transport - gotta be near public transport. Cutting the tenant pool too much if you exclude commuters on PTV

3. Reputation - some places just get bagged on forums like Somersoft, and others just simply have a fierce reputation (sometimes well justified!!). "No one wants to buy there" = less competition, lower prices. Only way to find out - go there, spend a bit of time, walk around, see if you get mugged, car gets stolen while you are walking the streets etc.... but seriously, is the station full of grafitti? Broken beer bottles on nature strips? Rubbish strewn everywhere?

4. Linked to reputation is outright demand - look for areas where open inspeciton means a bored lonely agent standing there hoping someone....anyone....will come along......

5. Rental yield (net of expenses) and vacancies. Inspect the rentals in the area, see how fast they go.



The Y-man
 
My method isn't very scientific:

1. Pick a couple of suburbs with median prices within your budget, that are easy for you to get to every weekend.
2. Go open-housing every weekend. Yay! Yummy flat white and a good sticky-beak at other people's houses!
3. Follow up an find out what the properties sell for. Maybe keep a spreadsheet if that's your thing.
4. Optional but encouraged: do some research with the council, find out information about zoning in the area, etc.

You'll start to get a feel for your selected areas. You'll know the good streets, bad streets, what sort of features people pay more for, etc. Most importantly, you'll know when a property seems over or under priced for the area and you'll be ready to jump in when you spot a bargain.
 
Read Margaret Lomas' "20 must ask questions for every property investor".

IMO that's how you get it done right.

It is a little bit too detailed for me, I use my instinct and a lot of on the ground research. When I'm looking I can name every house and sold price in an area for the last 5 years. It's like Rain Man. LOL.
 
As others have mentioned; thorough due diligence; based on 'income-earning-potential' parameters (so things like median area rental rates, capital growth trajectory, and demographic data such as suburb net migration figures), and not on factors that don't matter or affect the potential in comes production for the property (so, things like here say news articles; generic puff pieces, and sensationalist; sweeping statements about 'the property sector') are the best research metrics you can uncover. And should be looking for.
 
Imagine you:
* are on a low to medium income
* have an unreliable car
* work in the cbd or in a shopping/industrial area (if you're looking in/around cities)
* need a swimming pool and oval near by as well as somewhere to walk
* can handle the multi-cultural side of society
* have to be mindful of interest rates
* don't have any savings other than your deposit/equity
* don't have any one to catch you if you fall

You'll land in a few places. Look around, talk to locals. Would your pets be safe there?
Find the best deal.
 
Last edited:
RE Investar

Hi - great forum and great thread (I'm very new to this) - I've come close to buying a subscription with Real Estate Investar but haven't - does anyone else have it, and is it worth it?

Thanks again for all your good advice!
 
I've used Investar myself for the last 7 properties I bought.
I found the search function pretty interesting as you can look for certain strategies - like +CF. I really only used this feature to confirm that the area I was looking was pretty good compared to other stuff around.

The most useful feature for me was the My Valuer and Research that allowed me to look up old sales data and also give me estimates of current market value

Yes, I'm biased and there's a affiliate link on my site. But the bottom line is I would consider it money well spent as part of my due diligence and will do it next time I'm looking to buy.

Cheers,

Dwight.
 
I'm newbie but I reaserch areas in my price range as close to main city's with public transport to said city

Because I don't have a lot of money 'affordable rentals' are the option for me

Use MyRpdata to search areas - free

Keep looking at the areas on Realestae.com and look at past sales and rentals

Once a place is found use RP data (paid one) for past sales on that place

Pretty basic though

I do get into future council plans, proposed infrastructure. Just google the suburb and 'infrastructure'

Edit: and go to the library for books lol
 
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