Considerations when investing interstate
Could an interstate investment be the right move for you? If it is something you’re considering, you need to remember that in the Australian property market each state is different.
It can be tempting to invest in your local area – after all, it can be handy to have a rental property a short drive or even a brief stroll away from home. However, one of the golden rules of investing is to diversify your assets, and investing interstate can deliver valuable gains for your property portfolio but before you book a flight here’s a few tips to consider:
Do your research
It can be scary investing in an area you are unfamiliar with, therefore it is a good idea to do your research. Read property reports, use property magazines and conduct internet searches to investigate the area and consider demographic trends, local amenities and areas to avoid.
Know your costs
One of the major costs to consider when purchasing a property is stamp duty, which is different in each state and territory. You’ll also want to find out if any stamp duty concessions apply to your situation in the state you are purchasing in. Many of these of these schemes require that you live in the state you’re buying in, so it’s worth doing the research to find out.
You also need to factor in other costs, such as land taxes, title transfer fees and settlement costs which may vary from state to state.
Look at property management options before you buy.
It’s an extra cost that needs to be factored in but will give you peace of mind as a long-distance landlord. You will need to find someone you can trust to help you with a number of management tasks, such as finding the right tenants for your property, collecting rent, looking after bills, handling repairs or complaints, attracting good tenants and pricing your rent competitively.
Understand the different laws and processes in each state.
Each state and territory will have its own laws and regulations governing the sale and transfer of property. For instance contracts of sale vary state by state, so it could be a good idea to engage a local conveyancer to help you with the paperwork in the state you’re investing in. Cooling off periods also differ. Some states have cooling off periods up to five days, while others have no cooling off period at all and the amount of deposit you forfeit if you do not proceed with the sale also differs.
If you’re in the market for an investment property, looking to diversify, or simply looking for affordability, heading interstate could deliver the outcome you’re after.
Wherever you’re thinking about, talk to an Aussie broker today about getting the home loan that will work hardest for you. With your finances sorted, that’s one thing you can tick off the to-do list before you start booking your flights.
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- Chapter One : Things to consider before investing in property
- Chapter Two : Determining where to invest
- Chapter Three : Investment Properties by Dwelling Types
- Chapter Four : Finance for Your Investment Property Purchase
- Chapter Five : How to Invest in Property
- Chapter Six : Adding Value to Your Investment Property
- Chapter Seven : Positive and Negative Gearing
- Chapter Eight : Getting Your loan
- Chapter Nine : Selling your Investment Property