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3 Ways To Increase Your Property Investment ROI
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Property investment can be a great way to set yourself up financially—but much of your success hinges on finding the right property for your needs.
Will you buy an existing property that’s ready to rent? Purchase vacant land and build? Or opt for a knockdown rebuild?
The best choice will depend on many factors (too many to mention here!) and in the right circumstances, all of the above can be a great choice. As home builders, our expertise lies in building new investment properties—and over the years we have worked with many savvy investors who have found clever ways to increase their investment ROI.
If you’re considering building an investment property, educating yourself and doing your research is the first and most critical step in maximising your chances of success. So to help you get started, in this article we’re sharing 3 top tips to increase ROI on your investment property build.
1. Cost efficiencies when you build
If you’re building an investment property, it’s important to approach it with the right mindset. The design and features you choose should be different than those you would include in your forever home. That doesn’t mean you should skimp on quality or style, only that you keep it to scale and remain efficient in your thinking.
This starts with the size of your home, as building a huge home with underutilised space is unlikely to bring you a high enough rental return to warrant the added cost. You are likely better to look for a design that includes all the modern must-have features, but is cleverly designed to maximise space. This is one of the most effective ways to keep the price of your new home, or the knockdown rebuild cost of your project, in line with your desired budget.
2. Choose your features and fittings wisely
When it comes to selecting your features and fittings, you want to strike the right balance. On the one hand, you will attract more renters (and a higher rent) when your home is stylish, comfortable and has a modern, luxurious feel to it. However, be wary of including high-end luxurious features that will significantly add to your build cost.
The truth is, there are many beautiful interior and exterior finishes available that can fit within the standard pricing of your new home. Your designer can offer advice here, and a visit to a display home can be a great way to see how different features look firsthand. As well as style, go for features that are durable and long-lasting, as this will reduce the ongoing maintenance and replacement costs, which can add up surprisingly fast.
3. Add to your rental income
If your block allows, adding a granny flat or building a duplex can be a clever way of increasing your rental return. Having two dwellings on your land, gives you access to an additional stream of rental income. Plus, with a duplex build, you also have the option of living in one home, while you rent the other out.
While these types of developments perhaps have a reputation for being a little bland, we have built duplexes for many clients that are stylish and unique in their own right, while also blending well together to ensure an overall cohesive look.
There’s more to a sound investment than price and location
While it is clear to all that the location and cost of your property are the most important factors in a sound investment, there are other elements to consider that can take your ROI to another level.
If you are considering building an investment property, researching the market, speaking to experts and learning more about successful investment strategy is a must. Once you have a solid understanding, you can start to see more clearly the best path forward.
As builders in the Newcastle region, we have helped both new and seasoned investors build their property portfolio with our smart, economical homes and custom designs. If you’d like to find out more, get in touch with our friendly team today!
Key Takeaways
- Focus on cost-effective design and features that are essential yet efficient, avoiding oversized homes with underutilized space.
- Select stylish, comfortable features and durable fittings to attract renters without overspending on luxury items.
- Explore additional revenue opportunities like granny flats or duplexes to maximize rental income, especially if your property allows for such developments.
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