Investment loans | Mortgage Broker in Kellyville, The Ponds, Bella Vista
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What is an investment property, and what makes them good investments?
Properties that are bought with the intent to generate income through rent and/or resale are considered investment properties. Investment properties are a great option to invest in, as the property market is something that can appreciate greatly in a short time span, should the right factors fall into play.
Investment properties typically have a few key factors in common that make them valuable in the market. Things to look out for when purchasing an investment property include:
- Where the property is located - proximity to public transportation, schools, and lifestyle precincts is always valuable
- Type of property - Is it a house with a backyard? Is it an apartment? What is common in the property’s area?
- How old is the property - Does it need any repairs?
- Are there new developments in the area planned for the future?
These factors aren’t always a guarantee for success, as every property is unique, however, they are a fantastic place to start.
If you’re ready to start your property portfolio, be sure to have the best by your side. Contact Dinesh on 0421 822 843.
Using equity to purchase an investment property
If you’re already a homeowner, you have most likely built up equity over time. Equity is defined as the difference between the market value of your property and the outstanding balance. In simple terms, it can be defined as value - debt = equity. The interesting thing about equity is that it can be used in place of savings on a deposit for a property.
When considering using equity for a deposit, there is a general rule not to consider buying properties with a value more than four times the cost of your available equity.
As an example, you may have an accessible equity of $100,000 and are looking at a property worth $400,000. This means you would have enough for a 20% deposit, and potentially have wiggle room to go towards costs such as stamp duty.
If you’re ready to begin your investment portfolio the right way, get in touch with Dinesh today - 0421 822 843.
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