How to Invest Interstate… and Why It’s a Smart Move

Should you limit your investments to your own neighbourhood?

You have local insights, can monitor your investment closely, and undoubtedly appreciate your community!

But does that guarantee a wise investment?

Consider this: Australia has over 15,000 suburbs. Just because your suburb is a great place to live doesn’t mean it’s the best investment opportunity.

So what Makes a Suburb a Good Investment?

Several factors contribute to a suburb’s investment potential. When we choose locations for our clients, we consider all of them. We evaluate the local economy, upcoming projects, housing demand, and the level of supply being developed. We also assess local infrastructure such as hospitals and schools, potential future economic developments, and connectivity through road, rail, and air.

Additionally, we consider the economic outlook for the state and the current phase of the property cycle. The most promising suburbs are those on the brink of growth, rather than those that have already peaked.

Top Reasons to Invest Interstate

1. Maximised Capital Growth and Rental Yields: Investing in areas with the highest growth potential means your property value can rise quicker, allowing you to reinvest sooner and build wealth faster.
2. Diverse Growth and Yield Options: A varied portfolio provides strategic flexibility.
3. Risk Diversification: Investing in different states protects you against local economic fluctuations, reducing reliance on any single state’s economy.
4. Exposure to Varied Economic Conditions: Different states are at different points in their economic cycles, and some have stronger economies than others.
5. Price Point Variety: Different markets offer properties at various price levels, allowing you to choose between one high-value property or several lower-priced ones for flexibility.
6. Broader Property Type Selection: Access to various property types, such as house and land packages, Co-living, Dual Key, NDIS, Defence Housing & apartments, enhances your investment strategy.

Ultimately, the main advantage of interstate investing is the increased range of strategic options available. Having more choices allows you to select the best investments across the country, not just in your immediate area. Every investor has unique strategies, so there’s always a property that fits your needs.

Debunking Myths About Interstate Investing

You may still feel hesitant about investing interstate. Let’s dispel some common myths:

Myth 1: “I lack local knowledge.”

While it’s true you know your local market best, the internet provides extensive resources, including suburb reports and price histories. Furthermore our vetting process means we present less than 10% of properties made available to us to our clients.

Myth 2: “Travel will be too burdensome.”

Investing interstate doesn’t require extensive travel. Agencies like Fundamental Invest facilitate safe investments without needing to visit. While we recommend visiting recommended areas for confidence, modern tools like Google Street View allow you to explore remotely.

A good property manager can handle inspections and maintenance, allowing you to manage your property from afar.

Myth 3: “I’m confused about legal and tax differences.”

Each state has its legal and tax regulations, and it can be overwhelming. Fortunately, local conveyancers and lawyers can assist with purchases, while property accountants handle tax matters, ensuring compliance with state-specific requirements.

At Fundamental Invest we have access to a range of these professionals independent of our organisation including Mortgage Brokers, Financial Planners, Accountants, Conveyancers and Property Managers so we can pair you with the right expert to assist in a smooth property journey.

Myth 4: “What if the state experiences a downturn?”

Any state can face economic challenges, including your own. By investing interstate, you can select from a broader range of options and diversify your investments to mitigate risks associated with local downturns.

Conclusion

The aim of real estate investing is to maximise returns. It’s not about where you’ll live; it’s about the numbers. By expanding your investment choices nationwide, you can find the best properties that align with your specific goals and future growth potential.

With the help of a partner like Fundamental Invest, investing hundreds of kilometres away can be just as secure and convenient as investing in your neighbourhood.

Interested in Exploring Options Nationwide?

If you’d like to discover investment opportunities across different states, request a free consultation by clicking the link here and fill in your details.