Property Investing Basics - What Makes a Good Investment With Kristian Nelson-Marshall
Making Informed Decisions
Have you been like a cat at a fish bowl, looking into the Australian property markets only to find yourself unable to make that final commitment?
To help ensure you're the cat that gets the cream, you need to make informed decisions, which is why we've sought out some expert insights from Kristian Nelson-Marshall, the Director of LJ Hooker Inner City.
He started his foray in real estate on the day he left high school and purchased his first investment property at the age of 23. Around 21 years later, Kristian now has a colourful career that has stretched across the globe, receiving numerous accolades along the way.
All this puts him in a great position to share the secrets of his success by highlighting what makes a good property investment.
Where You Buy
"Location is obviously the most important, and that can be narrowed down as much as a street, or even an aspect of the street that can make a significant difference to the potential growth of a property's performance," said Mr Nelson-Marshall.
He asserts that if you are looking for an area to invest in, a good rule to stick by is to ensure that it is within a 10-kilometre radius of a major city hub - an even smaller distance for smaller cities like Adelaide or Perth.
"Also, it's sometimes a good idea to start your investment portfolio in an area that you live in, because you'll know that market more than anyone else does," he said.
What You Buy
Mr Nelson-Marshall stresses the importance of not only focusing on the quality of the property you purchase, but also the size.
"I've seen owners in the past caught out that way. They've gone and paid a price for a three-bedroom terrace, say in an area like Surry Hills, and it ends up becoming a two-bedroom rental because of the size of that third bedroom," he said.
If you're a first-time investor and can't decide between purchasing a house or a unit, Mr Nelson-Marshall recommends you discuss your objectives with the real estate agent and an experienced property manager as they will have a good perspective as to the rental capability of the property.
"Buy into an apartment building that is fairly modern - nothing too old where there could be a special levy raised as suddenly the building needs repainting because it's 30 years old or the fire alarms need to be upgraded, for example," he said.
When You Buy
Mr Nelson-Marshall believes there is never a bad time to buy property, you just may have to look in different areas depending on what the market is doing.
"The property market is only as abundant as the people pushing it. As soon as they step back, in my view, is when you should jump in on investment property," he said.
A proper understanding of the market is crucial. Mr Nelson-Marshall recommends going to open homes and viewing auctions to paint a clear picture of the market.
"If they're all going crazy then that's an indicator to me that it's time to take a step back and wait for things to settle down," he said.
Any Other Tips?
As some final pieces of advice, Mr Nelson-Marshall said to not expect quick profits from property, be patient, take your family and friends' critique with a grain of salt and ensure that you "engage a skilled and qualified property manager that has a good reputation, because that could make or break the investment".