Expert tips on long term property investment

The secrets of Keely’s success may not be rocket science, but they do require commitment and a long-term outlook.

Location, location

It may be a well-worn property adage, but Keely says buying in a quality location has been a key factor in helping him build a portfolio and see his property investments rise in value over the long term.

“I always buy as close as I can to both public transport and the beach,” he says. “In particular, I look for properties close to a train station or light rail stop.

“Good access to public transport is vital. Near enough won’t cut it. I look for properties within around 400 metres of direct city access.

“I also like properties that are close to the water. I think beach-side locations will always continue to go up in value, and if you can purchase something with a view of the water, all the better.”

Generate rental increases

A key theme for Keely has been increasing the rental return on his investment properties, thus decreasing his hold costs.

“My first property was in pretty poor condition when I bought it and I spent three months renovating while I lived in it. As a result I was able to achieve a higher rent once I moved out, and the property also became cashflow-positive in a shorter period of time. The rent this property achieves is now more than three times what it was when I bought it.”

A carpenter by trade, Keely tries to work on his properties himself, in his spare time.

“Saving on labour costs helps me achieve rental increases without having to outlay too much.

“I gave the latest property I purchased a coat of paint and spruced up the kitchen, and took the monthly rent it commands from $1100 to $1995.”

Invest early

Keely bought his first investment property at just 20 years of age.

“I worked hard, saved up a cash deposit and bought my first property in the best beach-side suburb I could afford.

“Now, many of my friends are in their late 20s or early 30s and feel locked out of the property market because prices have risen so much.”

Think outside the square

Keely has made some of his property purchases in partnership with his cousin.

“Going in with another investor has allowed me to buy and hold properties I couldn’t afford on my own.”

Keely’s latest property investment project is to develop a beach-side block of land he and his cousin purchased back in 2009.

“We are planning to build four townhouses on the block and keep two of them on completion. The more property you’ve got, the more you can make over the long term as the market continues to trend upwards.”

When it comes to buying and holding investment property over the long term, implementing a considered strategy can pay dividends.