The Top 5 Tips for Commercial Property Investors

WHEN YOU EMBARK on your journey as a property investor, it can be rather overwhelming – with a flood of information and diverse opinions.

To help simplify the process, here are five essential tips for new (and seasoned) investors.

1. Define Your Investment Strategy

Establishing a clear investment strategy is paramount. While strategies may evolve, having a foundational plan is the key. Consider factors such as purchasing multiple properties within a specific timeframe, diversifying across different locations, or building a portfolio to support your retirement goals.

2. Conduct Thorough Research

Understanding the property market you’re entering is critical. Begin by analysing the local area to gauge potential returns and identify target tenant demographics. Assess property trends, demand and supply dynamics – as well as economic indicators like employment rates.

3. Adopt a Rational Approach

When making investment decisions, prioritise practicality over personal preferences. While it’s tempting to choose properties based on personal appeal, focus on factors that ensure consistent rental demand.

Tailor your property selection to suit your ideal tenant profile,  to maximise your occupancy rates.

4. Build Your Support Network

Surround yourself with a competent investment team to streamline your journey. Start with an accountant and property advisor, who can help you optimise your tax position and oversee property management tasks.

Additionally, engage a specialist quantity surveyor to prepare a tax depreciation schedule, maximising available deductions. 

5. Understand Depreciation Benefits

Make sure you familiarise yourself with depreciation and its benefits for property investors. Property depreciation refers to the natural wear and tear of property and its assets over time, which can be claimed as a non-cash tax deduction.

A depreciation schedule outlines depreciable items, aiding in tax planning. Always seek expert guidance on depreciation – to help you maximise the potential deductions for your investment property.

Bottom Line: As you embark on your investment journey, leverage these tips to navigate the property market with confidence.