Numerous Australians have already succeeded in all aspects of property investing. However, stories of real estate triumph do not happen overnight, and a smooth sailing journey is not always guaranteed. Aside from risks that are needed to be taken, equipping yourself with adequate knowledge is an important step to take before you buy your first property investment.

Following this train of thought, Your Investment Property gathered three points you need to consider when buying properties – especially for those who are investing for the first time.

1. Financial capacity and risk profile

Understanding your own financial position and capacity to buy an investment property is essential, according to Michael Yardney. In addition, knowing how much risk can be handled as an investor is an integral step to start the investment journey.

These processes will be made possible with the help of a suitably qualified financial or investment advisor. It is recommended to spend on a sound, honest assessment of your situation, rather than losing money in the long run by going it alone and making costly mistakes.

2. Preferred property markets

Think about the type of location that will best suit your investing plans.

Many of the properties on the market at any given time might be ideal for a family home, but they may also not be what is deemed an “investment grade property.”

Qualify potential locations based on the history of capital growth achieved and potential of future capital growth based on the local supply, demand factors, and demographics of the area, specifically the local residents' ability to keep buying property.

Next, identify the best street in that suburb and the best side of the street in that suburb. Search for areas that have outperformed the long-term averages with consistency.

Do not invest in a place based on whether or not you prefer to live there. Instead, consider if it appeals to a broad owner-occupier and tenant demographic.

Here are some questions to ask, according to Yardney:

Does current or future projected demand look set to outstrip supply and underpin values for some time to come?

Is the area undergoing gentrification? Gentrification is a change in the fortunes of a suburb as it is discovered by a higher income demographic which slowly pushes out the lower income residents. The new, more affluent residents invest time and money in improving their new neighbourhood, causing prices and rents to rise.

Is there a lot of spending (private and public) on infrastructure upgrades and development?

3. Investment loan options and partners

While there are a lot of options, you must select the right kind of loan that could lift your financial position.

It is important to keep in mind that different investment loan options come with different benefits, and the best possible option depends on one's need

In other cases, people consider partnering up with their friends or relatives instead of talking an investment loan to start in the industry.

First-time investors need to carefully consider many factors while choosing partners, such as their comfortability with each other and the implications of a partnership agreement, according to a report by Forbes.

Investing can end either on a positive note or in a difficult condition. Hence, it is important to apply smart tips and research about the business as often as possible.