A new property investor shares her house hunting experience, and what she wants from real estate agents.
Last weekend, my husband and I traded in our usual sleep in for a morning of intense house hunting.
This isn’t an unusual way for a couple in their thirties to spend a Saturday morning, but for us, it was a slightly different kind of trip. Instead of looking for a place to call home, we drove two hours away in search of a house we would never live in – an investment property.
When we arrived at our first inspection, takeaway coffees in hand, it was clear by scanning the crowd that had gathered that we weren’t the only ones looking to invest. Residential real estate investment is seeing steady growth in Australia, which is unsurprising given current low interest rates and property value growth. If you’re a real estate agent, you may be asking: how can I engage these potential buyers? What kind of messages do they respond to?
Commonwealth Bank recently surveyed over 1,000 buyers on what appeals to them when house hunting. They discovered that first home buyers are more likely to be influenced by the interior design; subsequent home buyers are more like to be influenced by a vision of what they wanted before they moved in; investors are most likely to be influenced by how successful a place makes them feel.
I’m not sure if a successful looking place what we were after – many of the properties we shortlisted were nothing flash – but the research is right to suggest that as an investor, wealth creation is my primary concern. Rather than picturing myself living in a house I’m inspecting, I’m running through my checklist. What is the zoning for this property? Is there any structural degradation? Will I need to replace the carpet for new tenants? What’s the land size? What infrastructure is close by?
Agents would do well to remember this, along with a few other things I noted from my interactions with various realtors:
First, keep in mind I’m playing a numbers game. We did our research on where we wanted to buy six months before we took the plunge. We’re interested not only in capital growth, but also things like how much the rental yield is, how long it has been tenanted, the amount the property last traded for.
Real estate agents who communicate on this level stand out from the rest. As an investor, a tagline such as “low maintenance home in strong growth pocket with great value appreciation history, tenants keen to stay” has more cut-through than “dream home with ocean views”. Having the key facts and figures about a property on hand goes a long way.
Secondly, I’m interested in the local area. Most investors (and buyers, for that matter) are unfamiliar with the area they are inspecting. An agent who can show good knowledge of the suburb – and that’s more than what I can discover for myself on Google maps – is always appreciated.
At one property we visited, a friendly agent used his background as a local in the area to his advantage, sharing information about what type of neighbours lived in the street, where people liked to hang out, which schools were the most desired. His history and genuine appreciation for the suburb he grew up in, along with his in-depth knowledge of the infrastructure surrounding the property, was invaluable.
Finally, time is precious. Most people live busy lives, and a four-hour round trip to look at seven properties already takes up a good chunk of the weekend. I appreciated anything real estate agents did to save me time, from signing us in with an iPad rather than paper attached to a clipboard and responding promptly to messages, to telling us which other houses they were showing and how to get there, knowing we were only in the area for a finite period of time.
On that Saturday morning trip, we ended up making an offer on a house: the first in what will eventually be a portfolio of properties. Although we knew what we wanted, the agent who sold it to us – the friendly local – still played a key role in making that happen, making a repeat sale a real possibility.