Building an investment property is a labour of love - while it does require a lot more work than simply buying a pre-built unit, it's the perfect way to ensure you come out with a property that you love.
It's not a decision that should be taken lightly though. Securing the funding and building a property can be complex if not managed properly, and you need to ensure your vision for the end product considers how you will get the most value out it in the long term.
The three pros for building your own investment property
1. Customisation - Building your own property means you can design it to perfectly fit market needs. Often, properties you buy will have negative qualities at odds with the building's target tenant market or the surrounding neighbourhood.
2. Cheaper - If you do your research, buying the land undeveloped and building affordably could be more cost-effective than purchasing lock, stock and barrel. It may take more time, effort and stress, but it could be a difference of tens of thousands of dollars.
3. Instant reward - Again, with the right planning you could stand to gain instant equity from buying undeveloped land, building and then selling immediately to fund purchasing another property elsewhere.
What to consider before you build Thinking a build is a good alternative to buying an investment property? If so, you need to consider the common theme amongst all those positives: planning.
Property investment advisor Cate Bakos says the biggest rookie mistakes in building investment properties relate to poor planning, "Often, people build a 'dream home' to their own tastes, despite it being an investment.''
''Another common issue is building in familiar surrounds without consideration of what is best for their target tenant market," she says.
Without doing your research and planning ahead, your construction project could be a disaster. Here are some questions to consider before you start your build:
What kind of property do you want - A house? A multi-unit property? A commercial building?
What kind of tenant do you want? Are you building in the right area for them?
What is the surrounding neighbourhood like? Can you build to suit these tastes?
From there, you need to talk to local architects, planners and builders to figure out the costs and timeframe for your project!
Ready to build a path to success? Building your own property is ambitious - but with the right guidance it's an excellent investment. If you need help with securing the funding to start your build, speak to us today.