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The biggest risk of purchasing regional investments

By Reporter 05 May 2014 | 1 minute read

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.



The biggest risk of purchasing regional investments
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