Do you Want to Become a Property Tycoon?

So do you want to be a property tycoon, with millions of dollars worth of property under your belt? Silly question really, of course you do, we all do. But what are the fundamentals that these property magnates use, to expand their portfolios and wallets?

Now, I'm not expert in investing, my forte is in looking after your properties! I know however, that it takes a lot of commitment to learn real estate.You need to study the ins and outs like you would learn any other trade. So to evaluate the best potential  investment properties, you need to know your trade!

Knowing your trade, you need to know the fundamentals, and those are a lot of questions you need to ask of your potential investment property. To find the 'best of the best' start by asking the following questions: 

Area Questions:

• Does the property give a bigger rental return then the average for the suburb?
• What is the cash-flow for the property (positive, negative or neutrally geared) 
• How can you add value to the property? Would you rent it out fully furnished? could you add another dwelling (like a granny flat)? Could you renovate it?
• What are the vacancy rates for the area? If it's high for the area, you will need to factor that into your numbers.

Infrastructure Questions:

• What's the availability of new land? Is there going to be a release of large lots of land in the near future, if so, how will this impact your property value?
• What are the major projects happening in the area? New malls or retailers, train lines, large property developments?

Population Questions:

• What is the projected population growth for the area? Looking into a smaller community (say of 10,000) with a good projected growth (say 2000 people) within the next 4 years could be a smart move. Large populations with a stable population will not put as much pressure on the housing market and vacancy rates in the same way.

Demographic Questions:

• Look at the average income for the area? 
• How old are the people who are living there? 
• Are these people likely to be renters or buyers?
• If they are renters (which is what you want), what type of properties will they be looking for? 
• Families will be looking for 3+ bedrooms with low maintenance back yards. 
• The aged will be looking for a small, ground floor, low maintenance property.
• Students will be looking for a place close to school and have multiple bedrooms etc. 
• Professionals will be looking for a location close to business and coffee shops/restaurants, which usually means near the inner city.

Once you have the answers to all the above questions, you will be closer to selecting the right property for your portfolio. As you can see, there is a lot of work and research involved in finding the right place. 

Have I missed out on a vital question that you should be asking yourself before committing to a property?