Instead, finding a suitable property is the hardest trial facing property investors today.
According to Mortgage Choice’s 2014 First Time Investor Survey, 50.6% of investors who purchased their first investment property within the last two years said finding the right property was the hardest part of investing.
Mortgage Choice spokesperson Jessica Darnbrough said the results were surprising, especially given the current market conditions.
“With property values climbing considerably over the last 12 months, we expected to see more first time investors saying their biggest challenge was saving a deposit.
“Instead, just 15.3% said “saving a deposit” was the biggest challenge they faced when investing in property, while a further 15.5% said “choosing the right investment strategy” for their needs was the toughest aspect of property investment.”
Looking at the data, Ms Darnbrough said it was clear that Australians are quite particular about what they want from their investment property.
“They know what they want and they won’t settle for anything less. When purchasing an investment property, investors look for a dwelling that is not only located in the right suburb and is close to essential amenities, but also a property that is located in an area that has proven high tenant demand.
For investors, it seems location is everything. A property that is located in a good suburb and near the necessary amenities including cafes, restaurants and local transport, is likely to attract more tenants, which can help to increase the rental income generated by the property.”
[sam id=37 codes=’true’]Ms Darnbrough said investors are a savvy bunch – they have done their due diligence and investigated not only what locations are attractive to potential tenants, but what types of properties are in hot demand.
“More than 60% of recent investors admitted to purchasing either a small house (1 to 3 bedrooms) or a small unit (1 or 2 bedrooms) because they know these types of properties are in the highest demand.”
Just 23% of investors admitted to buying either a large house (4 or more bedrooms) or a large unit (3 or more bedrooms) as an investment property.Ms Darnbrough said.
“Today’s first time investors are switched on. They know what their potential tenants are looking for in a property and they aren’t prepared to buy something that doesn’t meet these requirements,”
“Despite the fact that the property market is running hot at the moment and there is a lot of competition out there from other buyers, it seems first time investors are happy to bide their time and wait until they find the perfect property.”