5 Property Investment Strategies to Boost Your Portfolio

Whether you’re a seasoned property investor looking to diversify your portfolio or you’re just getting started – purchasing an investment property can seem like a daunting undertaking. However, it’s certainly a worthy consideration. There are a number of ways you can break into the property investment world, so let’s take a look at these options and how you can benefit from each.

Gain Capital Growth

Arguably the simplest real estate investment strategy is to purchase a property with the sole intention of watching it appreciate over time and to eventually gain capital growth. Whilst this seems straightforward, it does require a fair bit of planning and research on the investors-side to ensure growth potential. This is also a great long-term strategy as it’s likely to take a minimum of 7-10 years before you see any growth.

If you decide this is the route you’d like to take, there are some factors to consider when beginning your property search:

• When looking for growth potential, it’s important to purchase in a suburb likely to drive up the value of your property in the future. Keep an eye out for proximity to amenities like schools and shopping centres.
• Research the types of properties likely to perform well to ensure you’ll be well placed to sell at a profit. For example; purchasing a one bedroom apartment in a family-centric neighbourhood is likely to shrink your buying potential.
• Look to future plans for your area of interest. New infrastructure builds such as public transport or highways could signal growth potential down the line.

Renovate/Subdivide

Another strategy worthy of investigation is purchasing a property in need of renovation and injecting further cash into improvements with the intention of then selling it at a profit or leasing it with a higher rental return. Many investors have seen decent returns with this strategy, however, it comes with some potential risks you may not be willing to take if you’re a relatively conservative investor.

With this strategy, there is always the chance that things won’t go to plan and your sale price doesn’t end up covering the costs of the renovations, making this a costly and time-expensive endeavour.

Another option along the same vein is to purchase a property on a large plot of land and subdivide. This offers the potential of a higher sale price as well as the benefit of earning multiple rental incomes in place of one.

Flipping Property

If you’re wanting to see a faster return on your investment, flipping a property may be a more appealing real estate investment strategy for you. The process of purchasing an unkempt property in need of repair, renovating and selling at an increased price can often take less than 12 months – making this an incredibly efficient way of expanding your investment portfolio.

As with any renovation project, this property investment strategy can be risky if you’re not particularly adept at budget management and assessing the potential for growth.

Buy and Rent

Purchasing a property to lease out to tenants with the intention of using the rent as a form of income and/or to cover the associated costs is arguably the most common form of real estate investment. This strategy relies heavily on the rental market and how much you have the potential to earn off your investment.

Whilst there are costs to consider such as property management and repairs, when leasing out your property you become eligible for certain tax deductions that may boost your capital.

Online real estate investing platform

For accredited investors, online real estate investing platforms work to connect them with real estate developers looking for finance. Investors look to gain regular payouts and the platform takes a, ‘finder’s fee’, for initiating the opportunity. This property investment strategy is limited in that it’s aimed solely at accredited investors (those who earn an income of more than $250,000 or have a net worth of more than $2.5 million) and can be a high risk and illiquid form of investment.

No matter the strategy you look to undertake, Ironfish has a range of tools available to help you get started. Explore our City Guides to find the ideal location for your investment property and learn about how the experts at Ironfish select properties.