What Makes the Right Property?

Posted by Jack Guthrie

A lot has changed in Australian property over the last 12 months. Foreign investment has been capped, depreciation benefits have been tweaked and Sydney’s juggernaut property market has finally headed into a stage of correction. The 12.2% reduction in Sydney’s median prices has helped to spark the age-old debate about where will be the next to boom. At Blue Wealth we allow research an analysis to guide our decisions, so the speculation doesn’t bother us. We take the big picture approach in finding the right property, in the right market at the right time.

The reality is that no matter the state of the market, the right property will always rent and sell strongly. So, what do we mean when we talk about the right property? How can we tell? There are a number of features that we look for when assessing a project, they separate the good, the bad and the right property:

Asset type

Your asset selection should be geared towards the property type that will attract the highest demand for a given location. If a property attracts the highest level of demand it maximises the opportunity for growth, while reducing the risk of rental vacancies.

Size

A property’s resale strength and rentability can be linked closely to it’s size. At Blue Wealth, our research model rejects any 1 bedroom apartment smaller than 50m² internally and any 2 bedroom apartment under 70m². People are naturally attracted to larger living spaces, so this allows your property to appeal more to prospective tenants and buyers.

Design

Efficient and aesthetically pleasing designs are often overlooked as investors aim to enter the property market at a low price point. The design of a property, however, can aid in boosting your capital gains over the long term. Features such as open floor plans, efficient ventilation and ambient natural light are all subtle dynamics of design that can mean a world of difference in the long run.

Value

The price of a property can vary greatly depending on size, aspect, quality and design. The bottom line is if you overpay for any these aspects, you may get a physically nicer apartment, but you are still getting bad value.

A great case study for the right property is our past showcased project in Nine Claire, McKinnon. This project was developed by an owner occupier focused builder/developer. The project had brilliant oversized, open floor plans that were built to an owner occupier standard. Nine Claire suited local demography perfectly and Blue Wealth managed to secure an economical price point for our clients. In a market where the media is slurring our lending environment, this project managed to achieve an initial bank valuation $40,000 over contract price. In short, the right property is just as important as the right market. That’s why we work with the top industry professionals in sourcing property. This allows us our investors to fully leverage off quality assets throughout their investment journey.

Posted by Jack Guthrie, on 21st Aug 2018