Do you want to grow your property portfolio? We guide Mum and Dad investors through to property purchases of $10m plus. Here’s the top questions to ask yourself.
WHERE IS IT LOCATED?
- How much has property grown in this location?
- Are you going to live in it yourself or have the property as an investment?
- What are burglary and crime rates like? Have you checked the area’s Census data for the local community profiles (professions, ancestry, age etc)?
- How far are hospitals, shops, public transport?
- How far are private schools and is the property within the local catchment of the public school you wish your child to attend?
- Is the walk to school route safe for kids?
- Is the property within 5km of the CBD?
- If you need to park at the train station, what is the parking like?
- How much noise is coming from the street in the bedrooms?
- Have you tested/assessed/asked about mobile reception inside the house and the area generally?
- Have you checked with local council/neighbours/locals/local paper reports to see if big developments or new transport routes are planned?
- Is the house/area prone to flooding or bushfires?
- Is the property north-facing?
- Is the property on a corner site (better potential for multi-development options).
Are there double storey homes surrounding the property (may be a good indication that renovation permits will be easier and this will add value to the property).
WHEN SHOULD I BUY?
- How much is solicitor and conveyancer, title fee searches and building and inspection reports?
- How much is stamp duty, lender’s application fee and valuation fees?
- Do I need mortgage insurance and how much?
- How much are ongoing fees eg council rates or levies?
- What are relocation fees eg removalist, connection fees, diverting mail fees, cost to change locks?
- Is the flooring OK or how much do I need to put aside for carpet cleaning or floor upgrade?
- What is the absolute maximum I can spend on renovation/new furniture or repaint?
- What is the time frame for neighbourhood developments? – eg a vacant lot next door could be a red flag for a noisy new development.
- What is the home’s potential? It may have terrible old dilapidated carpets, but the walls are sound.
- When was it last sold?
- What are future costs? Make sure you are aware of any planned levy increase.
- How much is in the sinking fund?
- Do I have a disclosure form? (Always ask for this to make sure you are aware of any structural or plumbing issues such as a drain under the house, soil contamination or lead paint.)
- Weigh up old versus new when forking out for a property inspection report.
Off the plan or new properties generally must have inspection reports to obtain a certificate of occupancy and have warranties on builders’ work, so the buyer’s inspection report is not as crucial.However for second-hand properties it’s a must for things such as asbestos in the roof, floorboards that are unsafe or pest, mould and damp issues.
- Weigh up the cost of furnishing, or buy the property with existing furnishing.
WHAT ARE YOU REALLY BUYING?
- Have you checked under the sinks for water damage or mould. Could patches of new paint possibly mean a prior water defect?
- Do all the windows and doors shut properly?
- Have you measured your furniture to see if it will fit eg fridge, piano or lounge?
- Should you downsize bedding – eg change one of the kid’s queen beds to a double to get more “room” out of a room?
- Are any trees near power lines that may need to be removed?
- Does the house have flyscreens? Is it leaking? Does it have smoke detectors, heating and air-conditioning or fans? These will be extra costs to make it compliant for renters under new building codes for tenants, if you are planning to rent the property.
- Are there enough power points in the house and are they where you need them?
- Is the house insulated, made with asbestos or does it have pests? (Again, get a building inspection report especially if it’s not a new property).
- What is the laundry drainage like?
- What are the bathroom and shower taps like for water pressure?
- Does the toilet flush well?
- Does the exhaust fan in the bathroom work well? (Put a piece of toilet paper under it – does the fan hold it up?)
- Does the floor creak noisily?
- Are there cracks in the ceiling? Movement cracks are common with settlement (often around doors and windows). However, large, jagged diagonal cracks or gappy cracks of more than half cm are more likely to be structural.
- Are they cracks in the wall?
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