Most people are unsure as to what they should really be paying attention to when purchasing an investment property, and oftentimes they search with their hearts, and not their heads. This can lead to bad property purchases, leaving people worse off financially.
Property investment research is mandatory before you purchasing a property. At Empower Wealth, we believe that this part of the process is absolutely non-negotiable. But with so many aspects to consider before you even start searching for a property, such as auction clearance rates, vacancy rates, pending building approvals, and a whole host of other data, it can get a bit confusing.
Our in-house Property Research division lead by Jeremy Sheppard takes out all the guess work from buying an investment property, providing detailed analysis and predicting the next location and property purchases for our clients, giving our clients peace of mind that they are making informed decisions. The key tool we use for this is the Demand to Supply Ratio. It’s a measure of the level of demand relative to supply in a property market. The demand to supply ratio, or DSR for short, gauges supply & demand by looking at a range of key property statistics such as auction clearance rates, vacancy rates, days on market, stock on market, ripple effect potential, market cycle timing, rental growth, and a whole lot more.
The DSR pools together these metrics to provide a single convenient score out of 100. It’s like an overall summary so we can quickly know if the market is in trouble or has some investment potential. The exciting thing about this is that we can pick out the better locations for our clients to invest in simply a matter of seconds. What’s more, it can compare each market using a consistent and independent manner. If you would like to learn more about our research variables, check out the videos below.
The other property research platform that we’ve developed in-house and to help our Buyers Agent Team buy the best possible asset for our clients is the Location Analyser. It looks at all the factors we mentioned above and provides a solid foundation that supports our Buyers Agent due diligence process. If you are interested to learn more about this, you can watch a quick demonstration video here: Location Analyser Demonstration videos.
Frequently Asked Questions
Why do you share reports from other sources?
Good content is something worth sharing. There is a lot of noise out in the property investment industry and some of this information may not be based on reliable research. When we do find a reliable and independent source of information, we think sharing it with others is the right thing to do.
Do you have your own research house?
Yes, Empower Wealth has built our own copyright software that looks at a variety of data sources. The output is only as good as the input, so when we are looking for good sources of information, we tend to focus on independent and high quality property data.
What are the best suburbs?
Clients often ask us this. Based on our property research data, we know that the answer is different depending on whether the property is a home or an investment.
If it’s a home, then the buyer needs to consider their own needs. This consideration will include proximity to friends, family, work, schools, lifestyle elements which hold appeal and of course budget. The most crucial thing when buying a home is to make sure it’s where your heart is!
What sort of capital growth can we expect to see in the next year?
Depending on the city/regional centre, the suburb, the street and the asset itself, this answer can vary greatly, however from a macro point of view, each state and their various cities will have their own growth drivers which need to be clearly understood before the area is considered as an investment option. In Melbourne we have had what many agents call ‘patchy’ performance. What they are really referring to are mixed levels of interest and mixed results for particular areas/assets. Melbourne is tough right now and is still considered a Buyer’s Market but it’s fair to say that good assets are still generating strong interest and delivering strong results for vendors. The high end and imperfect properties are the ones which are representing opportunities right now but each need to be considered carefully and on their own merits.
Can I buy your software?
No, at this point of time, our research software is exclusive for in-house users only.