Advantages of buying property interstate
As property markets take off you may find your local market has become too expensive for you to enter such as Sydney’s recent growth so buying interstate may be the next best thing.
Author of many property investment books Margaret Lomas has 40 investment properties, many of which are interstate.
Her theory is buying interstate forces you to do more research about the property and area and that it can be a brilliant idea to invest interstate.
According to Lomas, buying close to home may make us believe we are more knowledgeable than we think and that seeing or inspecting a property can cause an emotional buy-in.
Caution is advised to not fall for property spruikers offering free flights to buy in holiday destinations selling well above valuations. Different states also have different real estate and planning laws such as stamp duty structures and land tax which you need to be mindful of before you buy. Utilising a local solicitor or conveyancer is advisable.
The fundamentals of buying interstate and buying locally should not change. You need to look for areas with diversified industries that don’t just rely on one sector such as tourism. Its best to find an area with a permanent population, sound employment, councils with money to spend on infrastructure, good transportation, education, retail, medical services, recreation and entertainment facilities and with increasing household incomes and population.
While finding all these factors together may be difficult, having as many of them as possible will ensure you have a much better long term investment and may position you better than buying in the closest booming suburb where you live.
Published on 20th of October 2014 by Marty Stanowich