Tips for buying an investment property in Perth | WA Weekender
Momentum Wealth managing director Damian Collins recently featured on Channel 7’s WA Weekender program to share his top tips for buying an investment property.
Hear what he had to say in the video above and transcript below.
Jessie James (Presenter): “Buying an investment property can be quite exciting and daunting at the same time. Where do you start? Before investing, you really want to make sure you know exactly what you’re getting yourself into, and you are up to speed with all the rules and regulations involved with buying a property. Today, we will be chatting with Damian Collins, a Director at Momentum Wealth who is an expert in this area.”
Damian Collins, MD, Momentum Wealth: “Well, the first thing you’ve got to start with is the location, because at the end of the day, the land is what goes up in value, and the buildings over time depreciate and they fall away. So first, we are looking at areas that’ve got great infrastructure, great access to roads and freeways, good school areas, and just generally close to the city. And just think about it logically. Would you like to live in that area and would other people like to live in that area? So that’s the most important thing. Start with the location and then the house is second.”
Jessie James: “Is it best to get a property as close to the city as possible or further away? Does that affect rental return?”
Damian Collins: “Look, in an ideal world, you will be as close as you possible can to the city, but properties close to the city with a bit of land value are quite expensive. We are talking about potentially a million dollars plus. And they don’t make great investments because the rental returns aren’t as good. So we generally tend to stick about 10 to 20 kilometres out. You can still buy a great property between $450,000 – $600,000. So it gets really good rental returns, and as Perth grows, that will become considered almost in the city, and with it you can get the best capital growth in those locations.
As you can see, this property is not brand new and shiny, but it’s still very functional and liveable.”
Jessie James: “It’s a very nice one. So we have decided on the location. Where do we need to look to invest in the property?”
Damian Collins: “The most thing you want to focus is clean bathrooms, clean kitchens. As I said, it doesn’t have to be super modern, but that’s the most important thing. Everything other than that just have to be clean and presentable.”
Jessie James: “If you’ve never had an investment property before. How do you know where to spend that money on renovations?”
Damian Collins: “I’d talk to a REIWA agent. They’re person who has potentially sold you the property. They’ll know what’s suitable for that demographic in that area, and they’ll be able to give you good advice and information.”
Jessie James: “And with renting as well, they’ll be able to help there, because you obviously want to rent this property out?”
Damian Collins: “Definitely. Look, some people try to self-manage, but they generally fail. Best thing is to use a professional. They are some great agents, so talk to your local REIWA agent about renting your property out.”
Jessie James: “If you’re thinking about buying an investment property or even creating your very own property portfolio, it’s definitely worth a chat with a professional first. They can help you every step of the way, and before you know it, you could end up owning a property just like this.”