Where and how to find property hotspots

What are property hotspots?

We all know that getting ahead in property investment is about knowing where to buy, finding those illusive “property hotspots”.

A “hotspot” is typically defined as a property with higher than average capital appreciation and superior rental yields.  In addition, it’s an area that is undervalued and has the potential to do well in the next 12 months. The secret is getting in early before an area “takes off.”

So how do you spot a hotspot?

7 Top Property Hot Spotting Tips:

 

1.

First you’ll need to start off with an idea of what you are looking for…in this case you are looking for areas with good rental return and the potential for great capital growth in the short to medium term.

“Cheaper Houses often bring the highest yield…and higher yields are often a pre-cursor to growth!” Jenny Storey, Property Investor,  26 properties in 27 months

Always be on the look out and start with broad web searches and begin looking at the cheaper areas in each state.

Order your search results by Price, by Latest listing and by Suburb.

Look at overall prices in all areas along with rental returns.

Some helpful websites include:

www.domain.com.au
www.realestate.com.au

Don’t just limit yourself to these sites…think outside the square…did you know you can even purchase property on Ebay?

Note: the property that fits your criteria may not even be in your own state!

2.

Once you start searching through hundreds of properties you’ll start to see opportunities…such as undervalued properties, properties not to buy, properties that look promising, undervalued areas etc.

Tip: setup email alerts for areas that you are interested in and watch and be ready if you notice an area starting to boom.

3.

Look for an investment location that offers a potent combination of strong population growth, government investment infrastructure, and affordable prices. Nearby hospitals, universities, and major businesses are also good indicators since they will create new, long-term jobs and generate demand for rent.

4.

Get a good map of the area. Be wary of towns with just one road going through it. The town may not be  a place people stop, but just drive through on their way somewhere else. Look for a city, town, or suburb with several roads coming in, perhaps even a railway. You want a destination where people stop and do business and spend time there with recreation activities.

5.

Don’t discount a suburb or city just because it’s in another state. Many investors have invested in properties unseen! Purchasing properties in different locations can help you build a more balanced and protected portfolio.

6.

Once you’ve narrowed your choices, it’s time to do your homework. The internet, of course, is a great place to start. Look at the larger real estate sites. Use major investment property magazines for cross comparisons.

Some Questions you could ask include:

  • Are their multiple reasons that the area will grow in value?
  • Do tenants want to rent in the area?
  • Is the area a destination or a dead-end?
  • Are there any negatives mentioned about the location?
  • Are there any additional positives?
  • What is the population?
  • What are the population demographics?

You can find this information on…

  • Council Websites
  • Company Websites
  • Property Specific Websites
  • The internet is your best friend when it comes to investigating this sort of information

7.

Talk to people on the ground with their finger on the pulse of the town. Phone or visit local property managers and agents and ask about vacancies, good and bad streets, and the type of tenants in the area. Look at local newspapers. Read the minutes of council meetings. Is the city council focused on bringing new jobs to the area and actively promoting tourism or are they discussing major crime problems?
It’s important to dig deeper into each area you want to find the properties in the area with the most potential, you may even want to look for properties with a twist….perhaps a property that needs to be renovated, subdivided, used as student accommodation, developed or even combination of them all!  You are only limited by your imagination.

And remember, have fun every day of your life.

 

Diamond Member Bonus…

As a special bonus for Diamond Members – we have an audio copy by Jenny Stories titled Research “Where and How to Find Hotspots”

Jenny Storey is a formidable force combining a 30-year marriage, four children and property investment. Purchasing 26 properties between March 2005 and July 2007, Jenny has been the driving force in the Storeys’ property adventure and has purchased properties sight-unseen — including one on eBay!

Jenny uses research to find properties yielding eight to 10 per cent (or more) in areas of good future growth promise — mostly regional areas.

Click here to access a downloadable copy of this audio

To find out more about our Unique Diamond Membership program

and this months special offer click here

 

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