Investors building significant portfolios of properties have a property selection process to optimise their investment strategy.
Successful investors don’t take unnecessary risks. Nor do they get caught up in the current hype about a location or a particular type of property. Anyone can make money in a rising market, but long-term sustainable wealth follows a process.
Capital Edge has a detailed investment property selection process that follows the following steps:
- Clearly define your goals and current position.
- Understand the process for investing and building a property.
- Identify the high growth locations that meet the criteria.
- Select the best type of property for the location.
- Assess the sustainable returns.
Your approach to selecting the right investment property must be more scientific than the slogan “Location, location, location”. At the same time, don’t restrict your investment opportunities to the limited range of options offered by a project marketer trying to convince you that their selection of properties in a single development is all you need to consider.
- Parks, playgrounds, sporting facilities, childcare, access to beach.
- Public transport, access to freeways.
- Proximity to shopping centres, restaurants, schools, and medical facilities.
- Distance to CBD and local business hubs.
- Proposed infrastructure investment.
- Apply the Demand-to-Supply Ratio.
- Scarcity of land for the location.
- Land is where capital growth is achieved.
- Percentage of owner/ occupiers to tenanted.
- Current rental prices and supply.
- Vacancy rate.
- Apply the Land-Content Ratio.
Property Selection
Clearly define your goals & current position.
Understand the process for investing & building a property.
Identify the high growth locations that meet the criteria.
Select the best type of property for the location.
Assess the sustainable returns.
