Should I buy property in my suburb?

A lot of first-time investors are under the false impression that they should be buying property in their own suburb. While this can be a great strategy, it can also fail as well. Whether or not to buy in your own suburb really has nothing to do with the fact you live there. Whether or not to buy in your own suburb should only be based around the future performance of that suburb. If the prediction is that the area will be going upwards in value then go ahead and invest there, however, if the outlook on the area is not so bright, then you would not be a smart investor if you were to place your capital in that area.

There is a saying that I like to use that I think is very relevant: “A rising tide floats all boats.” This is such a great saying and so very true. If the whole area is going upwards in value, it is very easy to make the right investment decision. For example, from 2003 – 2006 the Perth market saw extraordinary uplifts in prices. Everything, including poorly located apartments went up in value. However, once the market had slowed in 2009, it was extremely difficult to find an investment that would increase in value in Perth.

So if you are looking to get started in property investing, don’t buy in your own suburb on emotion, only buy there if your research shows that the area is going to increase in value for you. Facts, not emotion is what gets the right investment.