05/05/2014. Jodie Hannaford
- Don’t buy sight unseen - hand-select properties and you’ll know exactly what you’re buying and what condition it is in. Real estate photography and descriptions can be misleading!
- Do a lot of research into the area and suburb, and buy properties with an exit strategy in mind. Purchase homes in communities with schools and good neighbourhoods, so the properties are easy to rent and resell (just like here in Australia!).
- Don’t just go for the highest yield. It might look great on paper, but you’ve got to be sure all costs have been considered (with none hidden) and that you will in fact receive the promised rental return.
- Do create partnerships both in the US and Australia. Ensure you have a quality agent managing your investment on the ground in the US, as your rental agent is the person you’re trusting to be your eyes and ears on the ground. They are your ongoing key to help eliminate any potential issues with the tenants and maintenance.
- Don’t underestimate good legal and tax advice. Find advisors who have an understanding of both the Australian and US legal requirements so that you understand the appropriate tax and structure implications for your investment scenario. Different rules and benefits apply to different types of investment (i.e. self-managed superannuation funds, individual and family trusts)
- Do value honest and competent builders. Costs of renovating or a ‘rehab’ are vastly cheaper than in Australia. A good builder will give you an itemised list of work to be done and will work with progress payments. It is important that you undertake a rehab that is suitable for the area and rental market.There's no need for granite bench tops in a property that does not require this level of finish!
- Don’t skimp on insurance. Never buy a property that you are unable to get title insurance from a solid, reputable title insurance company on. This is your ultimate guarantee of chain of purchase.
- Do read all paperwork in relation to Home Owner Associations (like our owners corporations) as some HOAs have rental caps which mean that you may not be able to rent out your investment property.
- Don’t assume it is easy to evict non-paying tenants. Ensure you are purchasing in areas which favour landlords and have efficient and cost effective means of removing a tenant if required.
- Do make sure you understand the insurance requirements for your area, as policies vary by state depending on the particular factors that may affect them such as tornados, flooding, and hail. Policy pricing also varies significantly if the property is vacant rather than tenanted.
Jodie Hannaford is CEO of Cashel USA Property Partners.
Do you have more than $120k in your super fund? You could use your super to buy property - Find out how
Top Suburbs :
tweed heads south
Get help financing your investment
Do you need help finding the right loan for your investment?
When investing in property, it is important to make sure that you not only have the lowest available rate that you can get, but also have the correct loan features for your needs.
Just fill in a few details below and we'll then arrange for a local expert Aussie Mortgage Broker to contact you and work out what features or types of loans are right for your needs. We'll even help with the paperwork. Plus, our mortgage broking service is at no cost to you.
We value your privacy and treat all your information seriously - you can check out