podcast

The biggest risk of purchasing regional investments

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Rich Harvey, Managing Director, propertybuyer

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The question as to whether to invest in a city area, a metropolitan area or a regional area is an interesting one. Our investors have shown that you can do just as well in a regional area as in the CBD. The thing for metropolitan investors is there's a very wide pool of tenants and you also have a diversity of employment opportunities. The risk of investing in a regional area is that the main employment drivers could dry up at some stage.  So regional investors need to do an extra layer of homework to make sure that the key drivers for employment are going to stay in place. I wouldn't advise to buy in a one industry town.  Places like Mount Isa or another area where there's only one major employer in the town can be quite risky. So if you're buying in a regional area look at what are the drivers. Who are the employers? What's the rental demand like? And what's the history of that rental demand been like over a period of time? But just buying in a capital city is not a fool proof investment strategy. When you're buying in a capital city, you've got to do just as much research to find the areas and the pockets of value and find areas where there's high tenant demand for the future.

Listen to other instalments of The Smart Property Investment Show:
Episode 74: How this investor plans to double his portfolio within 10 years
Episode 73: Bad builders: how this investor bounced back
Episode 72: Policy changes to interest-only loans: what buyers need to know
Episode 71: How this 'stubborn' investor recognised a property lemon
Episode 70: How this investor complements each property and balances his portfolio
Episode 69: Are you a ‘lazy’ investor? Consider the benefits to working with a financial team
Episode 68: Special episode: audience discussion live from the Property Buyer Expo
Episode 67: Don’t get ‘caught up in the now’: an expert reveals his tips for success
Episode 66: Wealth distribution: how should you manage your money?
Episode 65: Real estate agents: what separates the good from the bad?
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