You are the best time to start searching for your first house by signing up for the realty ads property investmentA perfect storm of stagnant property values has created a glut of vendors and low rates of interest that allow for bargains.

If you’ve been thinking of taking the plunge and becoming a property investor, then 2011 is the ideal time to enter the market, says property expert Chris Gray, CEO of Empire.

Gray, a qualified accountant, buyers’ agent and mortgage broker, says the combination of relatively low interest rates with the long-term potential for strong yields and capital gains presents the ideal conditions for property buyers looking to get into the market.

“If you have the finances to buy, 2011 will provide some great opportunities to buy that first investment property,” explains Gray.

“For those fixated on getting a bargain, there is a feeling that 2011 will be more of a buyer’s market. The heat is cooling down, as 2010 saw a buoyant start. Keep in mind that a cooling off doesn’t necessarily mean prices will fall – it just means that buyers are going to pay more reasonable prices, rather than frenzied record prices. Prices may go down more in low demand areas, but these areas will not give the same long-term results as the blue chip suburbs where there is higher demand and less supply.”

Gray believes that purchasing properties with a median price near the CBD will increase your long-term financial success.

“The best strategy for anyone looking to buy their first investment property is to buy blue chip, median-priced properties in areas where there is always demand,” he says.

“This is generally suburbs located 5–15km from the CBD, and near the beach in Sydney, or the bay in Melbourne. If you buy an investment property in these areas you will always be able to attract working professionals, which reduces the risk of the property being untenanted and assures you of good rental returns.”

Here are some tips to help you buy your first investment property.

  • Get involved
    You’re investing with a lot of money, so don’t take unnecessary risks by winging it. “Do your research on sites like RP Data or Residex, and get ready to enter the investment market with a bang in 2011,” Gray advises.
  • You can make certain that your finances remain strong
    Your broker should be consulted before you look at open houses and browse real estate websites. “The right time to buy your first property – whether it’s a home or investment property – is when you have your finances in order,” Gray says.
  • Rent where there’s the most demand
    Property rentals that are located near transportation and workplaces can cost as little as $550,000 to $800,000. “Suburbs close to CBDs and leisure facilities are the places working professionals will always wish to live in, so as an investor, you’ll never have any problems leasing the property,” Gray says.
  • Invest long-term
    “As an investor, you want to be in the market for the long term, which means there is no point trying to predict the next boom,” Gray warns. “If you do this, chances are you’ll miss it. It’s far better to look for quality stock that will always be in demand, rather than hoping to cash in on the ‘next big thing’.”