There are 2 key things an investor should look for when buying a property to rent namely (1) capital growth and (2) rental yield.(1) Capital growth is not assured as has been seen with the "corrections" that the property market has experienced both in the UAE and in international markets. However, an investor can minimise the downside by applying two key approaches:
Do Your Research: Look at as many investment properties as possible to get an idea about prices in the area, what adds value, which types appreciate faster, how to get a good deal (getting investment properties at much lower than market value) and what are the pitfalls of a too-good-to-be-true deal.
Location, Location, Location: Look for areas with potential for high growth and yields. Important things to look for are proximity to public transport, leisure activities (parks, beaches and lakes) and proximity to work and schools. Pay for some independent research which will tell you what the highest-rated areas are.
(2) Rental yield will be determined by the price you pay and the rental value of the property. ZeroAgents recommends our Indicative Rental calculator to determine the indicative rental value for the property and our Return Calculator for the potential rental yield.
“ In order to maximise the rental value get a good
investment property manager. ”
Having a good investment property manager is the best way to maximize your rental income and to ensure that it rises with the market. Self managed investment properties are often under-rented as owners are often not fully focused on managing their properties. Not only will a good investment property manger maximise the rental value but they will also get onto any arrears a lot quicker and will inspect your investment property to see that it's well maintained.