How to invest in the kind of apartment renters want
West Australians have embraced high-density living. This makes owning an apartment or two an excellent addition to your property investment portfolio.
But how do you make sure you’re putting your hard-earned money into the kind of property people will want to rent? It’s easier than it might sound. In our experience, here are the nine things Perth people are looking for in an apartment:
Location: Where is the apartment?
Most of the apartments built in the boom of the past 15 or so years have been built either in the Perth city centre or in the surrounding suburbs, like South Perth, Leederville, East Perth, Burswood, Northbridge, Nedlands, Como and Victoria Park.
That’s no accident — apartment dwellers traditionally want to live in a relatively central location. It’s all about lifestyle.
Unlike many cities around the world, Perth people don’t necessarily choose to live in apartments because it is the cheaper option; they’re choosing to live in them because they’re low maintenance and close to essential elements of their life — like work and good coffee.
Tip: Always research an area before you invest to see how desirable it might be.
Amenities: What’s around the local area?
Part of what makes an apartment desirable is the amenity of the local area. River views are great, but if it’s a two kilometre walk to a supermarket, that can make a property less desirable.
How close is the apartment to the essentials of life? Where is the nearest grocery store? The nearest café strip? Where are the local pubs, restaurants and parks?
If you’re considering buying a multiple bedroom apartment, consider how close it is to a school — that broadens the sorts of potential tenants you can attract.
The secret to success here is to think about the kind of lifestyle your potential tenant will have living in your apartment. The more amenities available in the immediate neighbourhood, the easier it will be for you to maintain rental occupancy.
Space: How big is the apartment?
According to a Master Builders Association of WA report from February 2015, apartment sizes in Perth are generally shrinking, but no one wants to live in a pokey space.
Buying an apartment with a larger floor space will ensure it is more desirable to prospective tenants. Choosing an apartment with more bedrooms will also widen the number of potential tenants.
Daylight: Is it nice and bright?
Back in the ’60s a lot of apartments built in Perth were not just small, they were also quite dark with very little natural light.
Perth has no shortage of sunshine and people love daylight streaming into their homes — whether it’s a bright summer’s day or a little winter sun.
Apartments with plenty of big windows (especially if those windows have views) and relatively few dark corners will always be popular with tenants.
Noise: Is there a thunder from the street below?
Apartment buildings are often found on busy roads or intersections or near thriving coffee and restaurant strips.
That’s all part of the reason people want to live there, but it also means there can be a lot of noise. How much of that noise is filtering into the apartment? The quieter, the better.
Ventilation: A breath of fresh air?
Can you open the windows? Are there doors out onto a balcony? As nice as air-conditioning is, anyone who works in a CBD office tower can tell you how awful being stuck inside without fresh air can be. Especially in Perth — where the weather is so good and we have such an outdoor lifestyle — people want natural ventilation.
Does the apartment complex provide outdoor public areas for additional relaxation or recreation opportunities?
Facilities: What’s included in the complex?
Modern apartment complexes are practically resorts. Gyms, swimming pools, rooftop gardens, cabanas, even saunas and steam rooms –you can get them all.
These sorts of facilities are a great attractor for tenants — especially well-heeled ones seeking a luxurious lifestyle. Pay close attention to what’s available. Access to a gym or swimming pool could be just the thing that swings a reliable, long-term tenant in your direction.
Inner-city apartments have the distinct advantage of being close to public transport, a feature that could quite possibly eliminate the need for a car altogether.
In a city like Perth, car parking is always an issue and having a car bay is a valuable bonus. Does the apartment come with a car bay? Or even two? A lot of apartments don’t offer parking facilities but those that do are always popular.
Finish: What’s it like inside?
Is the property finished to a high standard? Tenants will pay top dollar to live in a high-end property. Pay attention to the finer details. What are the bench tops in the kitchen made from? Is the stove Miele? Are the taps Hans Grohe?
Also consider whether the layout is right for the kind of tenant you’re hoping to attract. Is the layout relatively open plan? Are the bathrooms en suite?
Curb appeal: What does the building look like outside?
First impressions count. What does the building look like when you walk up to it or drive past it? It might not seem like the most important factor, but people want to live in beautiful buildings.
Does it look luxurious? Is it a landmark building in the local area? Would it impress your tenants’ friends if they said they lived there?
Not all apartments will rate highly in all nine areas, but if you choose a high-quality development in a great area, you’re well on your way to attracting quality tenants. Start by checking out Finbar’s current developments and/or completed developments ready to move into.