7 questions to ask yourself as a property investor

The property market in 2024 continues to perform strongly, especially in Sydney’s inner districts. With interest rates high but on hold, now could be a strategically good time to make a purchase.

This is because prices will probably take off once rates start to drop, as many experts are forecasting will happen towards the end of the year.

If you’re thinking of buying as an investor in Neutral Bay, here’s some information to confirm whether or not you are well positioned to take action.

What makes a successful property investor?

“Success” with property investing depends on a number of factors as well as your personal goals but think about the answers to these questions as a way to get started.

1. What is my current position? 

Before you leap into buying an investment property in Sydney or elsewhere, you need to know where you stand financially.

Review your current:

• Assets
• Equity
• Debts
• Liabilities and ongoing expenses
• Borrowing power

A review with a mortgage broker or financial planner will give you a clear picture of how much you can borrow and what repayments will look like once you factor in things like rent, holding costs and negative gearing.

2. What is my wealth strategy?

Next, you must consider your reasons for buying an investment property.
Property is a big investment, and you should clearly know what you hope to achieve long-term with your purchase.
You must consider factors like what rental income you will need to reduce the financial strain of your investment.

Other questions to ask include:

–  What sort of capital growth do you expect from the property?
–  How will you use the property?
–  Will it be a long-term rental?
–  Will it be a short-term rental like a holiday home or an Airbnb?
–  Do you intend to live on the property at some point in the future?

The answers will help shape your buying strategy.

3. Which loan will I choose?

How will you finance your investment property?
There are countless financing institutions with as many different rates and offers. Again, a mortgage broker is your best port of call to recommend the right solution.

4. Is it the right time to buy a new property?

As the saying goes, the best time to buy property is 20 years ago. The second best time is now.
However, you also need to speak with local property experts about how the area is performing and what the forecast is for growth within the time frame you hope to own your property.

5. Can I add value for faster capital gains?

Do you have the budget to fix up any investment property you might buy and how will you hit the sweet spot of a more valuable home without over-capitalising?

A renovation project is a great strategy to tap into fast capital gains but you need to build experience in this area over time. It will come down to your priorities and the timeline in which you hope to get results.

6. Do I need to change property managers?

If you have invested in property before, you will have worked with a property manager.
Even in our remote and digital world, it’s always recommended to work with someone local if you can, because they know the area and are close by when needed. As Neutral Bay’s local agents, we have looked after our clients’ investment property portfolios for years, and we are always happy to have that conversation.

7. Am I keeping on top of the market/educating myself about trends?

Research and knowledge are essential when it comes to property investing. As well as reading general articles and reviews, it’s a good idea to stay connected with people who know the market in the area where you want to buy. And the fastest way to answers is conversations, so don’t be afraid to reach out to us about what the Sydney market is doing.

Ready to invest in Neutral Bay?

The suburbs immediately north of the Sydney Harbour Bridge offer excellent investing opportunities because of strong demand from young professionals and families and their ‘urban village’ appeal.

If you feel confident after looking at the questions above, reach out to us to find out what’s coming up on the market in your price bracket.