One of my favourite parts of doing what I do is the property research phase.
Before instructing my clients when and where to consider investing in property, I spend a lot of time diligently researching the geographical area, and thankfully in the age that we live in with the internet I can research and look up data on just about anything.
But –
“99% of statistics only tell 49% of the story”
– and there’s only so much the numbers can tell me.
So although the Equidel property investment matrix can be filled out with some of the data I research, I find that there’s nothing better than hopping on a plane and getting my feet into the suburbs I’m researching.
Let me give you a couple of examples:
Population Growth – lots more people doesn’t always equal sound property investment
In 2019, I had my eye on a particular suburb in Queensland that – based on the figures alone – looked to be a sound area for a residential property investment. Population growth was high, property prices were very reasonable, but there seemed to be a high number of renters in the area compared to the national average.
As a part of my tour of the area in October 2019, I spent a couple of hours driving through the suburb and its surrounds, as well as the key economic zones nearby.
What I found was a ‘main street’ full of vacant commercial tenancies, not a lot of diversity in employment opportunities, and the majority of economic activity centered around fast-food retailers. I think I got my answer on the area pretty quickly.
Interested parties will paint a prosperous picture
It’s all well and good for the large property developers and local councils to tell us about the planned townships, education centres, employment hubs, and so on, around their latest property development.
But how far along are these actual plans? By driving through the location, you can quickly gauge how progressed the area actually is. How many houses are built or are in the process of being built? Are the parks and communal areas complete? What commercial economic activity is happening insofar as local amenities to support the community?
Asking the ‘locals’
While visiting particular areas, I’ll also make time to chat with my local industry contacts, local councillors and people within the state planning authorities. These individuals are very familiar with the areas that they operate in and can give me a fairly quick indication on the quality of an area both now, and into the future.
Driving down the streets where these property investment opportunities are also allows me to see what the surrounding houses are like, this gives us peace of mind that the data we have sourced lines up with the sorts of tenants we are expecting to attract in the future.
At the end of the day, my role isn’t to just trust the numbers I source. My role is to interrogate the numbers and make sure that I can positively answer this question:
“Would I feel comfortable investing my own money into
this property or this area?”
When I can confidently answer “Yes” to that question, then – and only then – will I present it as a property investment option to my clients. I wouldn’t offer them anything I wouldn’t invest in myself.
If you’d like a confidential discussion over coffee about investing in property for yourself, drop me a line at michael@equidel.com.au.
